1 MEETING 2 BEFORE THE 3 CALIFORNIA AIR RESOURCES BOARD 4 5 6 7 8 9 10 BOARD HEARING ROOM 11 2020 L STREET 12 SACRAMENTO, CALIFORNIA 13 14 15 16 17 18 19 THURSDAY, OCTOBER 23, 1997 20 9:00 A.M. 21 22 23 24 25 Vicki L. Medeiros, C.S.R. License No. 7871 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 ii 1 MEMBERS PRESENT 2 John D. Dunlap, III, Chairman 3 Joseph C. Calhoun Dr. Friedman 4 Lynne T. Edgerton Jack C. Parnell 5 Barbara Patrick Sally Rakow 6 Barbara Riordan Ron Roberts 7 James W. Silva 8 Staff: 9 Michael Kenny, Executive Director Tom Cackette, Chief Deputy Executive Officer 10 Mike Scheible, Deputy Executive Officer Kathleen Walsh, General Counsel 11 Jim Schoning, Ombudsman 12 13 14 15 16 17 18 19 20 21 22 23 24 25 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 iii 1 I N D E X 2 --o0o-- 3 Page 4 Proceedings 1 5 Call to Order 1 6 Pledge of Allegiance 7 Roll Call 1 8 Opening remarks by Chairman Dunlap 1 9 AGENDA ITEMS: 10 97-8-1 Public Meeting to Consider the 11 Report "Health Effects of Exposure to Environmental Tobacco Smoke" prepared 12 by the Office of Environmental Health Hazard Assessment 13 Introductory remarks by Chairman Dunlap 2 14 Staff Presentation: 15 Mike Kenny 4 16 Dr. Zeise 5 Dr. Byus 13 17 Mr. Howard 19 Mr. MacLeod 23 18 Mr. Knepperath 25 19 97-8-2 Public Meeting to Consider a Status Report on the Motor Vehicle 20 Registration Fees Program 21 Introductory remarks by Chairman Dunlap 35 22 Staff Presentation: 23 Mike Kenny 36 Ms. Burmich 37 24 Ms. Terry 54 25 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 iv 1 I N D E X (Continued) 2 Page Public Comment: 3 Mr. Mark Boese 67 4 Mr. Oscar Abarca 74 Mr. Edward Miller 82 5 Mr. Norm Covell 89 Ms. Barbara Lee 95 6 Open Session to Provide an Opportunity for 7 Members of the Public to Address the Board on Subject Matters within the Jurisdiction of 8 the Board 106 9 Closed Session 107 10 Afternoon Session 108 11 Adjournment 108 12 Certificate of Reporter 109 13 --o0o-- 14 15 16 17 18 19 20 21 22 23 24 25 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 1 1 P R O C E E D I N G S 2 --o0o-- 3 CHAIRMAN DUNLAP: Will this, the October meeting of 4 the California Air Resources Board please come to order. 5 We have asked our colleague, Sally Rakow, to lead 6 us in the pledge of allegiance, so please rise. 7 (Thereupon, the Pledge of Allegiance was 8 led by Board Member Rakow.) 9 CHAIRMAN DUNLAP: Thank you, Sally. 10 Would the Clerk of the Board please call the roll. 11 MS. HUTCHENS: Calhoun. 12 BOARD MEMBER CALHOUN: Here. 13 MS. HUTCHENS: DeSaulnier. 14 BOARD MEMBER DeSAULNIER: Here. 15 MS. HUTCHENS: Edgerton. 16 BOARD MEMBER EDGERTON: Here. 17 MS. HUTCHENS: Friedman. 18 BOARD MEMBER FRIEDMAN: Here. 19 MS. HUTCHENS: Parnell. 20 BOARD MEMBER PARNELL: Here. 21 MS. HUTCHENS: Patrick. 22 BOARD MEMBER PATRICK: Here. 23 MS. HUTCHENS: Rakow. 24 BOARD MEMBER RAKOW: Here. 25 MS. HUTCHENS: Riordan. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 2 1 BOARD MEMBER RIORDAN: Here. 2 MS. HUTCHENS: Roberts. 3 BOARD MEMBER ROBERTS: Here. 4 MS. HUTCHENS: Silva. 5 BOARD MEMBER SILVA: Here. 6 MS. HUTCHENS: Chairman Dunlap. 7 CHAIRMAN DUNLAP: Here. 8 Thank you. It looks like we have a full complement 9 of Board Members. 10 I'm happy to see that. I want to welcome all of 11 you. It is a pleasure to welcome you to Sacramento. 12 We have a relatively light Board Agenda today, 13 relative to issues. We only have, I think, two public issues 14 and one Closed Session issue. 15 I would like to remind those of you in the audience 16 who would like to present testimony to the Board on any of 17 today's Agenda Items to please sign up with the Clerk of the 18 Board. 19 If you have a written statement, we ask that you 20 provide the Clerk 20 copies so that we might have here at the 21 Board, each Board Member as well as the executive staff. 22 The first item on the Agenda today is 97-8-1, a 23 Public Meeting to consider the Report, "Health Effects of 24 Exposure to Environmental Tobacco," prepared by the Office of 25 Environmental Health Hazard Assessment, OEHHA. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 3 1 There have been a number of studies over the past 2 couple of decades examining health impacts of environmental 3 tobacco smoke, or ETS. 4 Results indicate that ETS is a real and preventable 5 health risk to the nonsmoker who is involuntarily exposed to 6 the hazardous substance. 7 The Report that we will hear about today represents 8 the current scientific understanding of these health 9 effects. 10 Before we get started, I would like to acknowledge 11 three members of the Scientific Review Panel, or SRP, on 12 toxic air contaminants who are here today. 13 I would ask them to stand, Dr. Craig Byus, Dr. Gary 14 Friedman and Dr. Stan Glantz. Welcome. 15 We also have representatives here from the 16 Department of Health Services. Mr. Michael Genest, Assistant 17 Deputy Director of Preventative Services, and Mr. Jim Howard, 18 Assistant Chief of the Chronic Disease and Injury Control 19 Division. 20 The Department of Health Services will make use of 21 the Report as it carries out its role for addressing health 22 effects related to tobacco use. 23 In addition, we have John MacLeod, Executive 24 Officer of the Standards Board of the California Occupational 25 Health and Safety Administration. I'd like to welcome him as PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 4 1 well. 2 Before we begin the presentation by the OEHHA 3 scientists, I have asked Mr. Kenny, our Executive Officer, 4 to provide us with the history behind the health assessment 5 of ETS. 6 Mike, I know you are going to be having musical 7 chairs, perhaps, during this presentation, so I wish you 8 luck. 9 I'm glad I'm not the one jockeying all of this 10 around. Good morning. 11 MR. KENNY: Good morning. Thank you, Mr. Chair and 12 Members of the Board. 13 I will begin the staff's presentation by giving 14 background on the development of the health assessment 15 of ETS. 16 The OEHHA staff will be following my remarks with 17 an overview of the ETS Report. Following OEHHA, Dr. Craig 18 Byus will be presenting the SRP's finding that resulted from 19 review of the Report, and then after that Mike Genest and Jim 20 Howard of DHS will come forward to make a statement and then 21 following them Mr. John MacLeod will make a statement. 22 In 1992 the health effects of ETS and the 23 significance to public health in California prompted the SRP 24 to ask that a comprehensive health assessment be done by 25 the OEHHA. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 5 1 As a result, a collaborate agreement between the 2 OEHHA and ARB was made to initiate such an assessment. 3 Although ETS would not formally be entered in the 4 State's Air Toxic Program, the ARB, OEHHA and the SRP agreed 5 that the Report would be prepared and peer reviewed under a 6 similar rigorous process. 7 The final draft of the Report was released for 8 public review in February of 1997. The SRP reviewed and 9 approved the draft Report at its June 1997 meeting and issued 10 their written findings. 11 The final Report includes the revisions requested 12 by the SRP and includes the public comments and responses to 13 the comments that were prepared by the OEHHA staff. 14 Now I would like to ask Dr. Lauren Zeise, Chief of 15 the Reproductive and Cancer Hazard Assessments Section at 16 OEHHA, to describe the process used to prepare the Report and 17 the results of their work. 18 Dr. Zeise. 19 DR. ZEISE: Good morning. I'm going to be making 20 my remarks and following the set of slides that you have 21 before you. 22 About a month ago we released the Document, "Health 23 Effects of Exposure to Environmental Tobacco Smoke." 24 We also posted this final Report on our OEHHA 25 Website. It has received, already, pretty wide public PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 6 1 interest and review. 2 This Report came on the heels of previous reports 3 by the Surgeon General, the National Research Council and the 4 U.S. EPA. 5 These previous reviews found a variety of health 6 outcomes. So, in initiating our review of environmental 7 tobacco smoke, we wanted to be careful about the different 8 health endpoints covered to make sure that we did have a 9 comprehensive report. We also didn't want to reinvent the 10 wheel. 11 We initiated the exercise by convening a public 12 two-day workshop to hear from individuals from the tobacco 13 industry, from public health groups and from Government about 14 the types of health effects that we should be very careful to 15 review, also, some of the concerns with respect to reviewing 16 the human data involved in this undertaking. 17 In addition to covering health effects, we have a 18 chapter on exposure measurement and prevalence, which 19 provides background for the health assessment review and also 20 looks at the issue of prevalence in particular in 21 California. 22 We initiated the Report by convening a team of 23 authors, public health physicians, epidemiologists, 24 toxicologists, who had expertise in a variety of endpoints 25 that were under review. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 7 1 The Report was initiated again in February of 2 1992. The two-day workshop was held in October of 1992. 3 There were a series of public comment periods and 4 workshops with a release of each chapter. So, each chapter 5 at a different period of time was released to the public, 6 received public comment and went through a review process and 7 then was revised. 8 We then compiled the various chapters together to 9 create the final draft, which was released in February of 10 1997. 11 The Scientific Review Panel, the Air Resources 12 Board reviewed our document in a public meeting June of 1997, 13 but the Scientific Review Panel did comment throughout the 14 process on the various documents as they were released as 15 well. 16 The final Report, again, was released last month. 17 So, just to summarize our review process, we would release 18 the document to the public and that would start a 45 to 60 19 day public comment period. 20 During the public comment period we would hold a 21 public workshop. Subsequent to the public comment period, we 22 reviewed the document and revised the document. 23 In total, in terms of public review, we had six 24 public workshops, one public forum and six public comment 25 periods. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 8 1 The compiled Report that was released in February 2 of 1997 received extensive comments. Those comments received 3 by the public are summarized in Appendix B, as well as our 4 responses to them. 5 The Air Resources Board and the Scientific Review 6 Panel reviewed Appendix B for completeness in terms of the 7 responses that were given. 8 Those commenting on the draft were many. There was 9 a large amount of comments received from the tobacco industry 10 and from the public health community. 11 These are all listed on your slide, the individuals 12 commenting on the February 1997 draft. 13 Now, what I am going to do is just to briefly 14 overview some of the findings in the document, and I will 15 divide these presentations into two parts, the first part 16 focusing on the exposure and prevalence chapter and then the 17 rest focusing on the different findings of health impacts. 18 From telephone survey information, we can see that 19 adult smoking prevalence is clearly on the decline. In 20 California the rate of decline is faster than the United 21 States at large. 22 This is important in terms of looking at the 23 different impact of ETS in terms of the numbers of people 24 affected by exposure. 25 We did see a very strong decline in California in PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 9 1 adult smoking prevalence, and one would envision accompanying 2 decline in ETS exposure. 3 In terms of toxic agents in tobacco smoke, there 4 are a variety of irritants, ammonia, acrolein and a variety 5 of other irritants, there are reproductive toxins, and there 6 are of order 50 or more carcinogens that are on the 7 California's Proposition 65 list, and a large number of these 8 have been listed as toxic air contaminants in the State. 9 On this slide, those agents in bold are those 10 listed as toxic air contaminants. 11 We found a variety of effects causally associated 12 with ETS exposure. These are effects for which there are 13 very strong human evidence that ETS causes these health 14 endpoints. 15 There is low birth weight. The finding here is 16 that infants that are already compromised may be further 17 compromised. That is the important aspect of this finding, 18 low birth weight is associated with a number of adverse 19 effects. 20 Sudden Infant Death Syndrome was a finding that our 21 Report was, I believe, the first in terms of an authoritative 22 review, to find, and this is because when we initiated the 23 review, while there were a number of reports indicating 24 smoking, maternal smoking was associated with Sudden Infant 25 Death Syndrome, these various studies that were available did PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 10 1 not separate out the impact from active smoking during the 2 pregnancy from smoking after the child was born, and there 3 were several reports during the course of our development of 4 the report that were able to separate out those two different 5 exposure periods, so clearly now we can say that smoking 6 after the child is born in the vicinity of the child is 7 associated with Sudden Infant Death Syndrome. 8 A number of earlier reviews did also comment on 9 respiratory effects in children. The human evidence has 10 continued to support the finding, and we find compelling 11 evidence for a number of important respiratory effects in 12 children, acute respiratory track infections, asthma 13 induction and exacerbation, chronic respiratory symptoms and 14 middle ear infections. 15 In terms of carcinogenic effect, the three 16 authoritative reviews by the National Research Council, the 17 Surgeon General, and the U.S. EPA all did find that lung 18 cancer is caused by environmental tobacco smoke, and we 19 continue to find evidence after the release of these reviews 20 consistent with these earlier findings. 21 The new finding in our Report in terms of cancer 22 was nasal sinus cancer. We found compelling evidence for 23 this endpoint. This endpoint is also associated with active 24 smoking. 25 In terms of cardiovascular effects, it is clear now PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 11 1 that ETS is associated with heart disease, mortality and 2 morbidity and the impact in terms of numbers of people 3 affected appears to be very large. 4 There are a number of other endpoints for which the 5 evidence was not as compelling but was suggestive, and 6 clearly these are endpoints for which we need further 7 research. 8 In terms of development, spontaneous abortion and 9 adverse impact on cognition and behavior, respiratory effect 10 and exacerbation of cystic fibrosis, a decrease in pulmonary 11 function and for cervical cancer, if we think about what the 12 opportunities are for public health protection, it is useful 13 to look at estimates of annual impacts, to see where one 14 would want to put their public health dollars. 15 These next three slides address impacts on infants, 16 children and adults. In terms of infant exposures, there are 17 of order 1,000 to 2,000 cases of birth weight reduction that 18 one could estimate associated with environmental tobacco 19 smoke exposure, and for Sudden Infant Death Syndrome of order 20 of 120 for that tragic event. 21 In terms of impacts on children and respiratory 22 conditions, there are very large numbers of cases that can be 23 associated with exposure to ETS, and the slide outlines the 24 various calculations that we have made for the U.S. and 25 California for children. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 12 1 The last slide shows estimated annual impacts on 2 adults. Clearly, heart diseases, an endpoint that needs 3 further study in terms of the extent of impact in various 4 ways in which one would go about preventing exposures, the 5 numbers of people affected appear to be very large in terms 6 of annual mortality. 7 Those were the Report findings for our Health 8 Effects Exposure Report. I want to at this point acknowledge 9 all of the people that worked so hard to put this Report 10 together and get it out. 11 The Scientific Review Panel gave us extensive 12 comment and review, and we really appreciate the Review 13 Panel's effort to make sure that we came out with a high 14 quality report. 15 The large number of authors that were involved in 16 this document spent long hours and sometimes a lot of 17 overtime making the various deadlines for the various 18 releases, and so we want to acknowledge all of their 19 efforts. 20 The public gave extensive comment. We really 21 appreciate the time that was spent putting together the 22 comments that we responded to. 23 Thank you. 24 CHAIRMAN DUNLAP: Thank you, Dr. Zeise. I 25 appreciate that summary of the ETS Report. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 13 1 Now, I would like to welcome once again and 2 introduce Dr. Craig Byus, of the Scientific Review Panel. 3 Dr. Byus is a Professor of Biomedical Science and 4 Biochemistry at the University of California, at Riverside. 5 Welcome, Dr. Byus. 6 DR. BYUS: I will read a little bit here and talk a 7 little bit, if you don't mind. 8 Thank you, Dr. Dunlap, and good morning, Members of 9 the Board. 10 I have been one of the lead persons for the SRP, 11 along with Dr. Gary Friedman, who is to my right here, on 12 environmental tobacco smoke, or ETS. 13 I was the lead person for the overall document, and 14 Dr. Friedman was the lead for the chapter on cancer. The 15 lead on the document was previously Dr. Charles Becker, who 16 moved to Aspen, Colorado, where he is now quite happy. 17 In addition, as you know, Dr. Stan Glantz, for the 18 Panel, also had a major impact on the preparation of the 19 document and is a world reknowned authority in this area of 20 research and made quite a large contribution to it. 21 The Report development has taken place over a 22 number of years starting in 1992, it's worth reiterating this 23 point, and concluding earlier this year. 24 As staff has pointed out, this document is not an 25 AB-1807 chemical, per se, so there is not the usual part A PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 14 1 and B that you are used to seeing. 2 The OEHHA staff prepared the Report, and the Panel 3 approved the report at its meeting on June 19 of this year. 4 The Panel views the Report as representing a 5 complete and balanced assessment of the current scientific 6 understandings of the health effects of ETS. 7 I will summarize the Panel's findings, but before I 8 do I would like to just in general say that I think that the 9 quality of this document is quite good. 10 I spent a fair amount time reading documents for 11 risk assessments and grant documents and whatever, and this 12 document was truly a pleasure to read. 13 It is written very clearly, very concisely. It is 14 a very complex issue, and staff and the Members of the Panel, 15 I think, did a very fine job in assembling it. 16 The data is analyzed extremely well, and this 17 weight of evidence approach, which is stressed throughout the 18 document, is very clearly outlined. 19 So, if you are ever going to read a document in 20 total, or read a lot of one, read this one, for both the 21 information provided, as well the approach that was taken, 22 because I think that it is very clear and very well done. 23 Clearly this is a very important issue. The Panel 24 uniformly believes that environmental tobacco smoke is a very 25 toxic compound, and is in fact a toxic air contaminant, and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 15 1 we believe the evidence reflects this with a very high degree 2 of certainty based upon large numbers of studies with a lot 3 of human data, which is unique to this sort of document, 4 there is a huge amount of human data just to back up these 5 conclusions, large numbers of studies. 6 The other interesting thing, and a little bit 7 different about this document, is that in addition to the 8 cancer endpoint there are a lot of noncancer endpoints that 9 are discussed in addition to cancer, which most of the 10 documents that you have seen before we have dealt primarily 11 with cancer, but this involves quite a few other diseases and 12 syndromes, so it is different from that point of view as 13 well. 14 In fact, the overall hazard of this chemical, or 15 this compound, is perhaps greater than even the sum of all of 16 the other compounds we have brought before you. So if you 17 added up the total risk of everything that we have brought 18 before you before, ETS probably has a greater risk than the 19 total sum of everything we have brought before, so just to 20 put that in perspective. 21 I will just read what I have prepared here, ETS is 22 an important source of exposure to toxic air contaminants. 23 Over 50 compounds in tobacco smoke have been 24 identified as carcinogens and six as developmental 25 reproductive toxicants under California's Proposition 65. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 16 1 Over 30 compounds in tobacco smoke have now been 2 identified as toxic air contaminants under AB 1807 and AB 3 2728. Despite an increasing number of restrictions on 4 smoking in California and an increased awareness of health 5 impacts, many Californians are exposed to ETS and a number of 6 people adversely effected is correspondingly large. 7 ETS exposure has continued to be a major public 8 health concern and has serious effects on the health of both 9 children and adults. 10 In adults noncancer effects of concern include an 11 increased risk of coronary heart disease, mortality and 12 nonsmokers exposed to spousal smoking, heart disease is the 13 primary fatal endpoint from ETS exposure. 14 Each year ETS exposure contributes to an estimated 15 4,200 to 7,440 deaths from heart disease in California 16 alone. 17 Also of concern in adults are lung cancer and nasal 18 sinus cancer which have been causally linked to ETS. 19 ETS exposure contributes to approximately 360 20 deaths from lung cancer each year in California. 21 Now in children, recent studies have demonstrated 22 increased risk of Sudden Infant Death Syndrome, or SIDS, due 23 to postnatal ETS exposure natural of infants. 24 Other serious impacts of ETS on the young are 25 increases in bronchitis and pneumonia. Annual mortality PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 17 1 estimates associated with ETS exposure to children in 2 California include approximately 120 deaths from SIDS and 16 3 to 25 deaths in toddlers and infants from bronchitis and 4 pneumonia. 5 In addition, there is compelling evidence that ETS 6 is a risk factor for new cases of asthma as well as 7 increasing the severity of this disease among children with 8 established asthma. 9 Each year in California ETS contributes to asthma 10 exacerbation and an estimated 48,000 to 120,000 children in 11 960 to 3,120 new cases of asthma in children. 12 ETS exposure of children also leads to increased 13 middle ear infection and chronic respiratory symptoms. 14 ETS exposure during pregnancy leads to increased 15 incidence of low birth weight infants, and low birth weight 16 is associated with many well recognized problems for infants 17 and is strongly associated with prenatal mortality. 18 Based on the available scientific information of 19 how ETS has a major impact on public health in California, 20 although the data indicated the prevalence of ETS exposure in 21 California is lower than elsewhere in the U.S., adults in 22 California are still exposed in some work places and in the 23 home and other indoor locations. 24 For children the most important single location 25 remains the home. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 18 1 Thank you for the opportunity to present the 2 Panel's findings to you today. I would ask if it is okay if 3 Dr. Glantz and Dr. Friedman would have anything to add to 4 this? 5 CHAIRMAN DUNLAP: Sure. 6 DR. GLANTZ: Well, I just want to second what Craig 7 said. 8 This is a literature I followed very carefully, and 9 I am familiar with what everybody else has done around the 10 world, and I think that it is fair to say this is the best 11 thing out there. 12 I think that this Report will be the definitive 13 Government document on the subject of secondhand smoke for 14 the next several years. 15 It is the first really comprehensive review of the 16 scientific evidence since the 1986 Surgeon General's Report. 17 While the Federal EPA Report is very good, it was 18 limited to lung cancer and respiratory effects, and I think 19 that this really does move the mark forward, and I think that 20 the staff can take a lot of pride, and it is just absolutely 21 an exceptionally well done job. 22 I have had comments from people all over the world 23 about this Report. There was a story that someone sent me 24 from Britain that the British Government is now citing this 25 document as a reason for taking regulatory action on PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 19 1 secondhand smoke. 2 So, I think you can be very proud of the work you 3 have done here. 4 CHAIRMAN DUNLAP: Great. Thank you for that. 5 I appreciate that overview. I know how much time 6 and effort the SRP puts in on the State's behalf. It is kind 7 of a little known secret. 8 I appreciate your leadership and your long 9 suffering as you looked at this issue and others, because I 10 know it is a lot of work. 11 All right. With that, thank you, Dr. Byus. 12 I would like to ask Michael Genest, or Jim Howard, 13 I know who are here, to come forward to the mike, from the 14 Department of Health Services to make a statement. 15 Good morning. 16 MR. HOWARD: My name is Jim Howard. I am with the 17 Department of Health Services. 18 I am with the Division of Chronic Disease and 19 Injury Control. 20 Our Division handles tobacco control in the 21 Department of Health Services, and I am here to thank you 22 all, particularly the Office of Environmental Health Hazard 23 Assessments, for their fine work. 24 Mr. Genest is representing the State Health Officer 25 who could not be here, unfortunately, today, if there are PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 20 1 questions he would be happy to answer those. 2 Before we get started, let me pass out some 3 T-shirts. For those of you that have been watching TV in 4 California or go past billboards or sides of buses, you have 5 recognized these things. 6 CHAIRMAN DUNLAP: That's one thing about this job, 7 we get a lot of T-shirts. 8 BOARD MEMBER FRIEDMAN: Not in my size. 9 MR. HOWARD: One size does not fit all. 10 CHAIRMAN DUNLAP: Jim Schoning, we are going to 11 deputize you to help us with the T-shirts. 12 MR. HOWARD: The message that we are trying to put 13 out to the public is that, although we use humor in a very 14 serious way, that environmental tobacco smoke does kill. 15 With the passage of Proposition 99 by the voters of 16 1988 and subsequent legislation through the 90's, California 17 has mounted one of the largest campaigns of its kind, an 18 aggressive multifaceted effort, which has included tough new 19 laws, an investment of which is now over three-quarters of a 20 billion dollars in health education and tobacco research 21 activity. 22 California's efforts have contributed to a nation 23 leading reduction in tobacco use among adults, and since the 24 inception of Prop 99 there are 1.3 million fewer smokers in 25 California and cigarette consumption in California has fallen PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 21 1 by more than 40 percent. 2 As you know, those of you who work, have been in 3 the State buildings for a number of years, we used to have 4 smoking in the workplace, and Governor Wilson had an 5 Executive Order and it eventually turned into a piece of 6 Legislation in the early 90's to ban smoking in the State's 7 20,000 State-owned or controlled or leased buildings. 8 In 1994 California had the most sweeping smoking 9 ban in the nation. It was AB-13 by Assemblyman Friedman. 10 Although primarily addressing the adult work force, 11 AB-13 affects younger workers as well as children from the 12 harmful effects of secondhand smoke present in a closed 13 workspace. 14 For those of you who have traveled outside of 15 California and go to other places in the country, or other 16 parts of the world, I think you can appreciate how nice we 17 have it here in California to not be exposed to secondhand 18 smoke. 19 Come January of 1998, those of you who frequent 20 establishments that serve alcohol are going to be smokefree, 21 as well as gaming clubs and a number of other places that 22 have had restrictions of tobacco use. 23 It mentions in the Report the importance of tobacco 24 smoking exposure to children. I think that is a message that 25 our media campaign needs to invest a lot of our resources to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 22 1 get the message out. 2 It makes a difference in a lot of adult's behavior 3 to quit smoking or reduce their tobacco consumption, and we 4 find that is a very important way of motivating folks not to 5 smoke around their children, and it helps them to motivate 6 them to quit smoking and hopefully not to take up smoking in 7 young kids as well. 8 I think that the scientific evidence that this 9 Report presents just bolsters our efforts in this regard, and 10 it will be a very powerful tool for us in working with our 11 communities, the communities of color in California to help 12 them understand the importance of not taking up smoking or 13 quitting smoking. 14 Any questions? 15 CHAIRMAN DUNLAP: I had seen, I think on your 16 Website, an overview of some of the State activities on risk 17 management. 18 I would love it if you have copies, I'd love to 19 have those handed out. 20 MR. HOWARD: I have a handout. 21 CHAIRMAN DUNLAP: I appreciated your point about 22 when you travel you notice that other places in the country 23 and the world have different feelings about smoking in public 24 places, and you don't see the framework that we have in 25 California. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 23 1 Any question of our colleague from DHS? 2 Thank you for the T-shirt. 3 MR. HOWARD: Now you are part of our media 4 campaign, so do wear those into public places and be prepared 5 to have people say, what the heck is that, particularly when 6 you are outside of California. 7 CHAIRMAN DUNLAP: Great. Thank you. 8 Now I understand that Mr. John MacLeod from the 9 California Occupational Safety and Health Administration 10 Standards Board would like to make a statement. 11 Mr. MacLeod, welcome. 12 MR. MacLEOD: Thank you. Good morning. 13 I don't have any T-shirts to pass out this 14 morning. We have a very prudent budget and a much smaller 15 organization. 16 I did have a few brief remarks. For those of you 17 who aren't familiar with the Occupation Safety and Health 18 Standards Board, we adopt the workplace occupational safety 19 and health regulations for public and private sector of 20 workplaces in California. 21 The purpose of these regulations are to provide 22 healthful and safe working conditions for all Californians. 23 I was requested to attend the meeting this morning 24 to hear the discussions regarding this Report on ETS and 25 essentially receive the Report from the staff. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 24 1 While the Standards Board currently isn't engaged 2 in any policy issues relative to ETS, the potential certainly 3 exists that this could become an issue in the future. 4 I believe this Report will serve us well in terms 5 of dealing with those policy issues if we are asked to 6 develop regulations or consider the development of 7 regulations. 8 I do applaud the effort of the people who were 9 involved in this. I know there were a number of people 10 involved in this, and I think it is a comprehensive 11 approach. 12 One of my staff persons has reviewed it, and I 13 think it serves its purpose very well. So, I congratulate 14 you on that and thank you for the invitation. 15 If you have questions, I will be happy to try and 16 answer them. 17 CHAIRMAN DUNLAP: Thank you. 18 Yes, Ms. Edgerton. 19 BOARD MEMBER EDGERTON: I would be interested to 20 know whether you do have any regulations at Cal OSHA 21 governing environmental tobacco smoke in the workplace? 22 MR. MacLEOD: No, we don't. 23 The AB-13 several years ago, essentially the 24 Legislature established law that prohibits smoking in the 25 workplace with a number of exceptions, I think there were PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 25 1 about 13 exceptions in that law, one of which you heard about 2 earlier, bars, taverns and gaming casinos, and that exception 3 will be expiring January first. 4 So, essentially the Legislature has acted on that. 5 Anything else? 6 Okay. Thank you very much. 7 CHAIRMAN DUNLAP: Okay. Thank you. 8 All right. I have no one that signed up to 9 testify, but I would like -- oh, I will, to come back to 10 that, ask Mr. Kenny for you to have your staff, or the OEHHA 11 team summarize any written comments we have had on this item. 12 MR. KENNY: No written comments. 13 CHAIRMAN DUNLAP: Okay. All right. 14 Seeing the NALA representative here, I thought 15 that -- 16 SECRETARY HUTCHENS: Excuse me, Mr. Chairman. 17 CHAIRMAN DUNLAP: Okay. Paul Knepperath, while we 18 are sorting out who signed up, from the American Lung 19 Association, will you come up. 20 It is my understanding, Paul, that one of the 21 previous presenters serves on the State Lung Association 22 Board. 23 MR. KNEPPERATH: That is correct. Mr. Howard is 24 not only on the State Lung Association Board, he is also on 25 the National Board, so he is definitely one of our chief PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 26 1 volunteers. 2 CHAIRMAN DUNLAP: So, he may be in part your boss, 3 is that correct, Paul? 4 MR. KNEPPERATH: In part he may be, although I have 5 not gotten my T-shirt yet. I like the one that says Bob, 6 I've got emphysema. I actually do have that one. 7 I appreciate the opportunity to be here. I am Paul 8 Knepperath, representing the American Lung Association of 9 California. We are an organization that has taken a great 10 deal of interest not only in the smoking issue, but intense 11 amount of interest since 1986 when the Surgeon General issued 12 the first report on involuntary smoking and its impact on 13 nonsmokers. 14 I think that was a big wakeup call for the country 15 and for the public and the public health officials across the 16 land to pay attention to the significant health impacts that 17 environmental tobacco smoke has on nonsmokers. 18 This Report that you are now hearing today is, I 19 think, an affirmation and a confirmation of the Surgeon 20 General's Report and everything that has come in-between, and 21 basically it says that ETS kills. 22 It kills nonsmokers, and it hurts nonsmokers, and 23 we think that this is important information that needs to 24 continue to get out. 25 There have been polls done in California that our PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 27 1 organization has done and others have done that consistently 2 show that Californians support smokefree workplaces, and not 3 only that, but they believe that secondhand smoke is harmful 4 and that it can kill people prematurely, those that do not 5 smoke. 6 While I think that this Report is excellent and 7 that it is going to be, as Dr. Glantz said, the document that 8 people will point to that will move us forward on this 9 agenda, I think it is important for you to know as public 10 officials and for the public to know as well that the tobacco 11 industry continues to maintain and continues to propagandize 12 that environmental tobacco smoke is not harmful. 13 So, it's important for us to keep the drum beat up, 14 keep the scientific evidence in front of us and remember that 15 the tobacco industry is here to do one thing and that is to 16 sell cigarettes and to addict people and keep them in a 17 lifelong habit of smoking that ultimately leads to premature 18 death. 19 This is not a lovely subject to bring up this early 20 in the morning, but I think that it is important for us to 21 remember that the tobacco industry will not go away on this 22 and this is an important Report for us to continue to flag in 23 the Legislature and across California. 24 I think one of the most significant scientific 25 aspects of this Report and has been touched on is the causal PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 28 1 link to SIDS. 2 I think that alone will really pay dividends for 3 this Report and the hard work that has gone into it. There 4 are many Californians out there concerned about SIDS, and now 5 we have scientific information that tells us that SIDS can be 6 brought on by secondhand smoke, and I think that is very 7 powerful information. 8 Lastly, I just want to say that I think that this 9 Report is going to help us with our continued policy efforts 10 in California as we move into Phase II of the California 11 Smoke Free Workplace Act which will begin January 1, 1998. 12 That is the piece of the Act which will include 13 bars, taverns and gaming clubs becoming smoke free. This 14 again, is a first for California and the nation. 15 There is no other state that on January 1, will 16 have bars that are smoke free. We should be very proud of 17 that and it is important that this information continue to 18 get out. 19 Anything that you can do as Board Members to 20 continue to educate the public beyond this hearing will be 21 appreciated. 22 Thank you. 23 CHAIRMAN DUNLAP: Thank you, Mr. Knepperath. I 24 appreciate those views. 25 Any questions of the witness? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 29 1 Yes. Dr. Friedman. 2 BOARD MEMBER FRIEDMAN: Let me preface my remarks 3 by saying that this is one of the best documents I have 4 read. This is a signal document that is going to be 5 extremely important. 6 I have a comment a little later about what we need 7 to do in a follow-up. 8 I have been the head of the pediatrics department 9 for much of my adult life. I really don't resonate to people 10 using baby issues on a big global issue that has many, many 11 components. 12 I also know the literature, the evidence about 13 tobacco smoke and SIDS, and I subscribe to the notion that 14 there is an association between tobacco smoke in the 15 environment and SIDS, but what you said in your remarks to us 16 was that this is cause and effect, and you and I both 17 recognize that SIDS is a multifactorial problem, and this is 18 a component of the problem. 19 I don't want to -- the thing that I loved about 20 this Report was its balance. It did not over sell in any way 21 what the issues were. 22 The analyses were right on target. The pros and 23 cons were discussed in such a truly erudite way, and I don't 24 want people running around saying that we know that 25 environmental tobacco smoke killed your baby, because that is PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 30 1 not correct. 2 When you present to a parent, and I have done this 3 unfortunately too many times, and talked to them after a 4 sudden infant death, you tell them everything, including all 5 the other associations, but when the etiology of a disease, 6 or an entity is not known, you can't go around claiming that 7 you have the answer. 8 So, let's get just a little more balance, and let's 9 not use this as the spearchucker kind of a -- it is not, 10 environmental tobacco smoke is bad for so many reasons, SIDS 11 does not have to be the lead pony, nor should it be the lead 12 pony. 13 The evidence for other things is so profound and 14 it's well presented. So, I guess what I am saying is a 15 little moderation. 16 MR. KNEPPERATH: I hear what you are saying. I 17 think it is recognized that there are a lot of impacts of 18 ETS. 19 I think my point here, Dr. Friedman, is that this 20 Report of all of the reports that I have read, and I agree 21 with you the readability of this Report is incredible, you 22 can actually sit down and read it from cover to cover and 23 understand it, but I think our point is that this is the 24 first time that I have read in literature, and the first time 25 that I know of, that there has been this link. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 31 1 I don't expect that we are going to go around 2 saying, you know, waving a flag saying, this causes SIDS, but 3 I do think it important for people to recognize that this is 4 pulled out. 5 BOARD MEMBER FRIEDMAN: Well, that's fair. 6 John, can I continue? 7 CHAIRMAN DUNLAP: Yes, please. 8 BOARD MEMBER FRIEDMAN: I gather that this Report 9 after we decide about what to do with it goes on to State and 10 Federal, OSHA, to the EPA and so forth. 11 I guess I recognize that what happens indoors is 12 not in our immediate domain, but I would ask if there is some 13 way for us to be informed serially of what progress the 14 impact and influence of this pivotal Report has on our 15 colleagues beyond the Air Resources Board. 16 I wonder if you can help provide some scheme? 17 CHAIRMAN DUNLAP: That is a very important point, 18 and I think Dr. Byus and Dr. Glantz had similar thoughts that 19 this Report would also be used elsewhere, not only to 20 educate, but allow people to understand what approaches they 21 might take in using it. 22 Mike, I know there had been an attempt, at least 23 yesterday, to talk about how we might have some regular 24 reports and some follow up. 25 Could you take a few words and tell us about that, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 32 1 Mike? 2 MR. KENNY: Sure. Dr. Friedman is right, we don't 3 have any indoor air authority. 4 So, from a regulatory standpoint we are precluded. 5 At the same time there are a number of agencies, both at the 6 State level and at the Federal level, who do have the 7 authority and the ability to go forward and do things. 8 Our thought there was to essentially forward the 9 Report on to them to those even that are not here today and 10 to then maintain a contact with them and find out what they 11 are doing, and then we can report back to the Board on a 12 regular basis and let the Board know what is happening as a 13 result of the regulatory authorities that do exist out in 14 both the Federal and the State levels. 15 CHAIRMAN DUNLAP: Okay. Very good. Thank you. 16 Mr. Kenny, do you have anything else to add? 17 MR. KENNY: What I would like to add is that I 18 really want to thank the staff of the Office of the 19 Environmental Health Assessment, and the SRP, and 20 specifically, Dr. Friedman, Dr. Byus and Dr. Glantz. 21 I really appreciate their effort on this particular 22 project, and I want to congratulate them on reaching this 23 very important milestone. 24 Secondly, I want to thank the Board. I think the 25 key thing there is that this is an important item, and it was PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 33 1 important for the Board to hear this item so we could provide 2 it for them to facilitate a public acknowledgment of what is 3 the most important and recent scientific findings regarding 4 environmental tobacco smoke and their consequences. 5 Thank you. 6 CHAIRMAN DUNLAP: Thanks, Mr. Kenny. 7 Ms. Edgerton. 8 BOARD MEMBER EDGERTON: There is someone that I 9 would like to thank as well. 10 He's not here, but his name is Pete Wilson. I know 11 he signed in 1992 the Bill to make all of the State buildings 12 smokefree, based on the evidence that he had at that time and 13 also approved that this Report go forward. 14 I think it is that leadership, as well as, such 15 impressive, this Report is so impressive as well as those 16 people who put it through, but I think his leadership is 17 deserving of credit on this particular issue. 18 CHAIRMAN DUNLAP: Great. Thank you. 19 All right. If there are no other comments, let me 20 make a few wrap-up remarks, and we will move on to the 21 Resolution we have before us. 22 I would like to thank Dr. Zeise for her commitment 23 and that of her staff to this project and for their excellent 24 work, also, as Mr. Kenny said, the SRP, your work and 25 commitment, and again, I just -- it has been amazing the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 34 1 amount of time and effort put in. 2 I know that you are not compensated by any stretch 3 of the imagination for the time and effort that you put in on 4 the State's behalf, but it is appreciated. 5 Secondly, I would like to thank the representatives 6 from the Department of Health Services and the Standards 7 Board for attending today's meeting and for tracking this 8 important issue with us. 9 I wish you well in your ongoing efforts to inform 10 the public about this very significant health issue. 11 Again, Mr. Kenny, to echo, I guess, your remarks, 12 we will look forward to regular updates, and I know that the 13 Board Members that serve on local boards, I am certain, would 14 have it in a way that they could share it locally. 15 So, Mike, I would leave it up to you as you package 16 it. 17 So, since this is not a regulatory item it is not 18 necessary to close the record, so I won't. We do have a 19 Resolution before us. 20 I will ask the Board to just take a moment. We 21 have had it for some time now. It's Resolution 97-40, which 22 contains the staff recommendation, and this Chair would 23 entertain a motion and a second to adopt. 24 Very good. There has been a motion by Dr. Friedman 25 and a second by Supervisor Roberts to move the item. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 35 1 Is there any discussion? 2 Very good. We will proceed with a voice vote. 3 All those in favor, say aye. 4 Any opposed? 5 Very good. Thank you. 6 Thank you very much. 7 All right. What we will do then, as the staff and 8 our colleagues move their places, I think we will go to the 9 second Agenda Item, which is the Motor Vehicles Fees 10 Program. 11 Then we will take the Closed Session Issue later, 12 closer to lunch time. So, Lynn Terry, as you are coming 13 forward, to kickoff this Item, 97-8-2, a Public Meeting to 14 Consider a Status Report on the Motor Vehicle Registration 15 Fees Program. 16 This Item is a staff update on the Motor Vehicle 17 Registration Fee effort. The State law specifies two uses 18 for these fees. 19 First, for air district implementation of the 20 California Clean Air Act, and secondly, to fund projects that 21 reduce motor vehicles emissions. 22 Emission reduction projects are funded through air 23 districts as well as other local government agencies. 24 Staff last reported to the Board on this Program in 25 1995. At that time we adopted criteria for use of these PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 36 1 funds by recipient agencies. 2 I expect that staff's presentation will review 3 those criteria and discuss how they are being used. 4 It's my view that it's important that the Board 5 continue to evaluate the use of these funds to ensure that 6 the program achieves the maximum air quality benefit. 7 I appreciate the input provided by air districts 8 and the other recipient agencies in the process. ARB staff 9 relied on the data provided in order to prepare these updates 10 to the Board and to, I think, emphasize a point, one of the 11 things that this Board stands for very clearly is proper 12 management of air quality improvement dollars, whether we are 13 in control, or the local districts. 14 I think that in order for us to have a strong 15 program we need to be able to defend how these dollars are 16 spent. 17 So, with that, I would like to ask staff, Mr. Kenny 18 has left for a moment, so I will ask Lynn Terry to perhaps 19 introduce this item and get it under way. 20 All right, Mike. Don't be a socialite when we are 21 moving on with the Board's business here. 22 MR. KENNY: I hope I'm in the right place. 23 Thank you, Mr. Chairman and Members of the Board. 24 I see today as an opportunity to set in motion a 25 number of steps that will help improve the Motor Vehicle PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 37 1 Registration Fee Program. 2 The recipient agencies are numerous, over 150 3 individual cities and counties in the South Coast Air Basin 4 alone. 5 In addition, 26 and 9 Bay Area congestion 6 management agencies receive these funds. Given the large 7 number of recipient agencies, it is a challenging task to 8 evaluate the use of these funds on a statewide basis. 9 It has been equally challenging to find ways to 10 efficiently share our technical expertise about the emission 11 reduction benefits of the proposed projects. 12 Today staff will discuss some steps that we think 13 will help get the word out about what makes a good project 14 from a emission reduction standpoint. 15 That after all is what the Program is entirely 16 about. I will now ask Ms. Pam Burmich, of our Office of Air 17 Quality and Transportation Planning, to begin her 18 presentation. 19 MS. BURMICH: Thank you, Mr. Kenny. Good morning. 20 I'm pleased to give you a status report on the 21 Motor Vehicle Registration Fee Program. 22 In my presentation I will begin with an 23 introduction, then I will discuss the current uses of these 24 fees, agency response to ARB criteria, and proving cost 25 effectiveness and finally, staff recommendations. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 38 1 Let's begin with the introduction. 2 Who receives motor vehicles fees? 3 In the South Coast, 30 percent of the fees 4 collected go directly to the air district, 30 percent go to 5 the Mobile Source Review Committee, MSRC, and 40 percent to 6 city and county governments. 7 In the Bay Area, 60 percent of fees go directly to 8 the air district, and 40 percent go to the 9-county 9 congestion management agencies, CMAs. 24 other nonattainment 10 air districts receive 100 percent of fees collected in their 11 area. 12 In fiscal year, 95-96, air districts received $50.3 13 million. 14 Board Members, please note that this correction to 15 your copy of the slides, which reads 46.5. The MSRC received 16 $11.8 million, South Coast cities and counties received $15.7 17 million and Bay Area CMAs received $7.8 million. In total, 18 $85.5 million was distributed. 19 The purpose of the fees are twofold. 20 First, air districts use these fees for program 21 purposes. District responsibilities under the California 22 Clean Air Act include air monitoring, emissions inventory, 23 modeling and preparation of clean air plans. 24 Second, funds are to be used for projects that 25 reduce motor vehicle emissions. These projects can reduce PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 39 1 emissions by putting cleaner vehicles on the road, or by 2 reducing vehicle travel. 3 In 1995 as part of its oversight role, the Air 4 Resources Board reviewed and evaluated how these fees were 5 being used and at that time the Board took two actions. 6 First, the Board adopted statewide criteria for the 7 use of the funds. Second, the Board directed staff to report 8 in 1997 on how agencies use the criteria. 9 Now I will review the criteria that the Board 10 adopted. First, funds should be used to implement the 11 California Clean Air Act. 12 Air district responsibilities to implement the Act 13 are considerable and ongoing. As mentioned previously, they 14 include all of the technical work necessary to enable their 15 boards to adopt and implement effective clean air programs. 16 The air districts also use these funds for projects 17 that generate direct emission reductions. The Board 18 recommended that at least 50 percent of the funds be spent 19 for projects that directly reduce emissions. 20 This leads to the next criterion, cost 21 effectiveness. Cost effectiveness is expressed as dollars 22 per ton of pollution eliminated. 23 Projects funded should be $20,000 per ton, or 24 less. The Board selected $20,000 per ton as a benchmark 25 based on the uppermost end of air pollution control cost. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 40 1 The third criterion is co-funding. This criteria 2 helps to stretch our air pollution dollars. 3 The fourth criterion is new technologies. The need 4 for advanced technologies is critical to areas with long-term 5 pollution problems. 6 Now let's talk about the current uses of the fees 7 using 95-96 data. Air districts have responsibility to 8 prepare and implement clean air plans. 9 They use motor vehicle registration fees for many 10 technical activities needed for this effort. Funds are used 11 for air quality planning, control measure development, air 12 quality monitoring, modeling and emission inventory and 13 public education. 14 In fiscal year 95-96, funds expended for program 15 activities statewide was 36 percent of funds received. This 16 meets ARB's criteria that districts program funding not 17 exceed 50 percent of total funds received. 18 This graph shows the percent of motor vehicle fees 19 used for district program funding over the past five years. 20 The higher level in fiscal year 91-92 reflects the work air 21 districts were doing to prepare their first plans to meet the 22 requirements of the California Clean Air Act. 23 As you can see the funding then leveled off and has 24 remained stable. 25 Now I will review what kinds of projects have been PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 41 1 funded. 2 Here are the top five uses statewide for direct 3 emission reducing projects in fiscal year 95-96. The largest 4 category was cleaner vehicle purchases at $9 million. 5 Second was traffic flow improvements at $8.8 6 million. Then employer based trip reduction at $6.2 million, 7 transit operations and shuttles at $5.3 million and vehicles 8 scrappage at $3.3 million. 9 Next I will discuss spending priorities separately 10 for air districts and the MSRC and for local governments. 11 In fiscal year 95-96, air districts and the South 12 Coast Mobile Source Review Committee spent the largest 13 portion of their funds on cleaner vehicles. $7.2 million was 14 spent for cleaner vehicle purchases and $4.3 million for 15 cleaner vehicle research. 16 Transit operations and shuttles received $4.1 17 million, and vehicle scrappage received $3.3 million. 18 Air district spending focused on vehicle 19 technologies demonstrated to reduce emissions. South Coast 20 cities and counties had a different emphasis in their 21 spending. 22 Traffic flow improvements received $4.5 million and 23 employer trip reduction received $3.7 million. Next came 24 cleaner vehicle purchases at $.9 million and transit 25 operations and shuttles at $.5 million. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 42 1 Traffic congestion is largely a local 2 responsibility. In addition, many local governments have 3 responsibility for achieving emission reductions pursuant to 4 the Air District Rule 2202. 5 As a result, a large portion of funds spent by 6 cities and counties went to congestion relief, or to maintain 7 programs to meet emission reduction targets. 8 Similar to the South Coast cities and counties, the 9 Bay Area CMAs allocated $1.8 million to employer trip 10 reduction and $1.4 million to traffic flow improvements. 11 Bicycle facilities received $1 million and cleaner 12 vehicle purchases $9 million. The Bay Area Air District 13 rescinded its employer trip reduction regulation in response 14 to Legislation passed in 1995. 15 However, over 700 employers continued to implement 16 trip reduction programs on a voluntary basis. The CMAs 17 support this effort with motor vehicle registration fees. 18 Let's look at what has happened since ARB adopted 19 criteria in 1995. The ARB criteria were distributed by staff 20 to all recipient agencies statewide. 21 Staff worked with a Committee of the California Air 22 Pollution Control Officer's Association, CAPCOA, to develop 23 cost effectiveness methodologies and project design 24 guidelines. 25 ARB staff have participated on air district grant PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 43 1 committees, including the South Coast Mobile Source Review 2 Committee and the San Joaquin Valley Unified Air Pollution 3 Control District Grant Committee. 4 ARB staff have participated in numerous local 5 workshops to give technical assistance one on one to local 6 government staff and project proponents. Staff provides 7 ongoing support to air districts and the public on a daily 8 basis. 9 Now I will discuss response to ARB criteria 10 separately for air districts, the MSRC, South Coast cities 11 and counties and Bay Area CMAs. 12 Most air districts address all four Board 13 criteria. Most of the air districts use a request for 14 proposal process to select projects that meet specified 15 criteria. 16 Cost effectiveness is given greater priority than 17 other criteria by most districts. The South Coast Mobile 18 Source Review Committee allocates its funds through the 19 competitive grant process. 20 Their requests for proposals used by the MSRC 21 address all four of the Board's recommended criteria. Cost 22 effectiveness is given priority in project selection. 23 The MSRC has also adopted a two-year spending plan 24 in order to further increase efficient use of these funds. 25 South Coast cities and counties generally select PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 44 1 projects to fund as part of their yearly budgets. Most do 2 not address the Board's criteria. 3 ARB staff and the South Coast Air Quality 4 Management District staff have been working to inform local 5 governments on cost effective ways to spend these funds for 6 air quality. 7 Most of the agencies do not yet address cost 8 effectiveness during project selection, although this year's 9 reporting process has helped to raise awareness and begin to 10 develop expertise. 11 The South Coast Air District is also providing 12 additional technical assistance to help cities and counties. 13 The Bay Area Congestion Management Agencies use 14 some of the Board criteria during project selection. Each of 15 the nine agencies have their own process for allocating these 16 funds. 17 A portion of the funds is returned to the local 18 cities and their remaining portion is allocated through a 19 competitive process. 20 This varies for each CMA. Some CMAs do not have a 21 competitive process and return all the funds to the cities. 22 As a result, cost effectiveness is addressed on a 23 limited basis. The CMAs must select projects from a 24 statutory list. 25 This list is comprehensive enough to enable CMAs to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 45 1 fund projects that meet the Board's cost-effectiveness 2 criteria. 3 When we summarize the response to ARB criteria 4 statewide, we conclude that three of the four criteria are 5 being met. 6 Regarding the first criteria, to implement the 7 California Clean Air Act, air districts are using these funds 8 to meet their responsibilities in developing and implementing 9 clean air plans. 10 Next is cost effectiveness. There has been a mixed 11 response to this criterion. 12 Cost effectiveness clearly needs improvement. I 13 will talk more about this later in the presentation. 14 Regarding co-funding, staff calculated that for 15 every dollar of motor vehicles fee spent there was a $1.60 16 contributed to projects from other public and private 17 sources. 18 Recipient agencies are doing a good job of 19 stretching these air quality dollars by leveraging other 20 funds. 21 Last is new technologies. The most significant 22 portion of the motor vehicle funds used to advance new 23 technologies are allocated through the Mobile Source Review 24 Committee. 25 The MSRC includes research and development of new PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 46 1 technologies as a category for funding within its project 2 proposal process. 3 During fiscal year 94-95, the MSRC granted $.5 4 million to advance new technologies, and 1995 through 1997, a 5 two-year cycle, it allocated $4.5 million. 6 Now let's talk about improving about cost 7 effectiveness. The cost effectiveness criterion applies only 8 to emission reduction projects. 9 Some projects necessary to the successful 10 implementation of clean air plans do not lend themselves to 11 cost effectiveness evaluation. 12 These include new technology, infrastructure and 13 public education. These kinds of projects need to be 14 assessed in a context of clean air plans. 15 Cost effectiveness applies to the remaining 16 emission reducing projects funded. This slide shows the 17 estimated percent of project spending used for emission 18 reducing projects under $20,000 per ton for fiscal year 19 95-96. 20 The air districts and the MSRC used an estimated 65 21 percent of funds cost effectively. South Coast locals and 22 Bay Area CMAs used an estimated 40 percent of funds cost 23 effectively. 24 Cost effectiveness was reported for only one third 25 of projects funded in that year. These estimates are based PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 47 1 on data provided by recipient agencies for fiscal year 2 95-96. 3 Staff used this information to estimate levels of 4 cost effectiveness for the remaining in the same category. 5 ARB staff adjusted local evaluations to standardize 6 the useful life of projects reported, update emission factors 7 and addressed assumptions that seemed to deviate 8 significantly from the norm. 9 Staff also used ARB staff evaluations and research 10 information to augment information reported by recipient 11 agencies. 12 Because no cost effectiveness information was 13 reported for CMA projects, estimates for these projects are 14 based on comparable projects. 15 This evaluation indicates that there is room to 16 improve overall project cost effectiveness. 17 Finally, I would like to point out there was 18 necessarily a lag time between ARB's adopted criteria and the 19 implementation of the criteria by recipient agencies. 20 Most project decisions for fiscal year 95-96 had 21 been made by the time ARB's criteria were in place. The 22 effective criteria on project spending will be better judged 23 when we review data submitted for fiscal year 96-97 and 24 beyond. 25 Here are some basic reasons why projects exceeded PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 48 1 $20,000 a ton. 2 First, poor project design. We have found several 3 examples of this problem, including transit services with low 4 ridership, employer trip reduction programs with high staff 5 cost, bicycle paths used primarily for recreational biking, 6 shuttle services that sustain the transit dependent rather 7 than targeting existing auto drivers and vehicle purchases 8 where there is no guarantee that emissions will be reduced. 9 Another problem is when air quality is a secondary 10 benefit to the project rather than the primary benefit. 11 Examples are projects primarily done to relieve 12 congestion, improve safety or provide for the elderly or 13 transit dependent. 14 While these are important projects to fund for 15 other reasons, they typically yield limited air quality 16 benefits. 17 Next, agencies sometimes funded non air quality 18 aspects of a project. The typical example of this is funding 19 the full cost of a new vehicle rather than a cost 20 differential between a cleaner vehicle and a conventional 21 vehicle. 22 If the agency funds the full cost of the vehicle, 23 the cost effectiveness will be well over $20,000 a ton. 24 Local governments have a tendency to fund the full 25 cost of new vehicles more so than do air districts. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 49 1 Last, a lack of technical expertise can lead to 2 funding project that have unfavorable cost effectiveness. 3 We are always learning more about what works and 4 what doesn't. Being abreast of the latest information is 5 critical to good funding decisions. 6 What are some examples of cost effective vehicle 7 projects? 8 Cleaner vehicle technologies continue to be an area 9 of success in reducing emissions from motor vehicles. A good 10 use of funds is to pay the cost differential for cleaner 11 transit bus purchases, school bus purchases, heavy duty truck 12 purchases and retrofits, and cleaner construction and farm 13 equipment. 14 Vehicle scrappage programs are typically cost 15 effective as well. A number of transportation demand 16 management, TDM projects, have been shown to be cost and 17 competitive. 18 Long distant commuter bus and vanpool services are 19 examples. Commuter buses should be cleaner fueled buses. 20 Targeted shuttle services and transit use 21 incentives are also examples. These kinds of projects need 22 to be focused on shifting current automobile drivers to 23 transit. 24 Last, commuter oriented bicycle projects can be 25 cost effective. These projects focus on reducing commute PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 50 1 trips. 2 Now I'll discuss staff recommendations. Staff has 3 three recommendations for improving cost effectiveness. 4 First, statewide guidelines should be developed to 5 ensure that technical assistance is available to those 6 agencies that lack air quality expertise. 7 Second, the guidelines should include a list of a 8 cost effective projects that can guide future funding 9 decisions and be updated as needed to reflect the latest 10 knowledge. 11 And third, the guideline should provide for uniform 12 cost effectiveness methodologies. This provision would build 13 on the work that has already been done through the CAPCOA 14 Committee. 15 The process to develop the guidelines would include 16 meeting with stakeholders to get their input on program goals 17 and potential program improvements. 18 Second, staff would create a statewide technical 19 working group to share air quality expertise and provide 20 input to the statewide guidelines. 21 The working group would include representation from 22 air districts, South Coast cities and counties and Bay Area 23 CMAs. Membership would reflect representation from small, 24 medium and large cities and air districts. 25 Last, with input from the technical working group PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 51 1 ARB staff would prepare guidelines and present them to the 2 Board for approval next year. 3 The conclusion of staff's review of this program is 4 that increased cost effectiveness of project funding will 5 resolve in maximum air quality benefits. 6 While the program has generated innovative emission 7 reducing measures, with better cost effectiveness this 8 program can achieve increased emission reductions in the 9 future. 10 Thank you for your attention. That concludes my 11 presentation. 12 CHAIRMAN DUNLAP: Okay. 13 Any questions of staff before we get into 14 witnesses? 15 Mr. Calhoun. 16 BOARD MEMBER CALHOUN: Are all of the projects 17 funded under this Program submitted to the Air Resources 18 Board for comment and review? 19 MS. BURMICH: The data is reported to us. 20 BOARD MEMBER CALHOUN: I mean the project, before 21 the project is actually implemented? 22 MS. BURMICH: No. 23 BOARD MEMBER CALHOUN: On page -- on the summary 24 of your Report, it said over the past two years staff has 25 worked with local agencies to incorporate the recommended PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 52 1 criteria and the local project selection process and to 2 provide technical guidance. 3 Most air districts have incorporated the 4 recommended criteria in their program. Other recipient 5 agencies in South Coast cities and counties and Bay Area 6 Congestion Management Agencies have not formally adopted the 7 criteria. 8 None of these agencies are obligated to adopt our 9 criteria; is that correct? 10 MS. BURMICH: No. They are not. 11 BOARD MEMBER CALHOUN: So, it is a case of us 12 trying to get them to buy in? 13 MR. BURMICH: That's correct. 14 BOARD MEMBER CALHOUN: Okay. 15 In the last sentence you state that in addition 16 these agencies generally lack the technical expertise 17 necessary to implement the criteria. 18 Are we doing anything to help out in that regard? 19 MR. BURMICH: We have been working with the South 20 Coast District, in particular, to distribute technical 21 information to the cities that would help them make good 22 decisions. 23 I also work with them. They call me on a regular 24 basis. 25 I hear from the cities and counties, and I try to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 53 1 help them understand how to evaluate their projects, so that 2 while they are preparing to make their funding decisions they 3 can decide if it is going to be a good project or not. 4 Unfortunately, they don't, they are not all up to 5 speed yet on how to do that. 6 CHAIRMAN DUNLAP: I had a question, if you would 7 take me back a few slides in your memory at least, there was 8 a 65 percent number thrown out in your slide presentation 9 about a criteria that we suggested that was actually being 10 followed, did I get that right? 11 MS. BURMICH: Yes. 12 We estimated that 65 percent of the air district 13 projects were less than $20,000 per ton. 14 CHAIRMAN DUNLAP: Okay. Thanks. 15 Now, I guess I would like perhaps an anecdotal 16 information about how it is going in working with the air 17 districts. 18 I mean, one of the things that those in the 19 audience and perhaps some of my Board Member colleagues are 20 unaware of, there is a lot of pressure in Sacramento these 21 days to be able to secure dollars for new programs. 22 A lot of people see government as the way to 23 demonstrate new technologies, new approaches of controlling 24 air pollution, not just in a mobile area, but we see it 25 stationary and in other areas. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 54 1 So, there is a lot of pressure on having those 2 dollars made available to a lot of good projects. So, it is 3 important that these dollars that have been allocated thus 4 far are spent in a way that is defensible, people see their 5 value and that officials, not just the Air Resources Board, 6 but Members of the Legislature and the Governor can see that 7 we are serious about this problem and we're doing everything 8 that we can, that the dollars are defensible. 9 The question I have for staff, I know it is a 10 difficult task doing kind of a review, we try to summarize 11 what is really going on out there, how vulnerable, or how far 12 do we have to go to be able to have these dollars spent as in 13 airtight a manner, as defensible a manner as possible? 14 Are we close? Do we have a long ways to go? Is it 15 largely a small district problem? 16 I mean, can you characterize it for us perhaps 17 anecdotally? 18 MS. TERRY: I think we have a long way to go in 19 many cases. 20 If you notice there was a theme in the presentation 21 related to technical assistance, technical expertise. 22 I think the air districts obviously are in a much 23 better situation to be able to select projects that have 24 maximum air quality benefit. 25 There has been a good amount of progress with the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 55 1 air districts through the years that this program has 2 evolved. 3 They still have a ways to go, but for the most part 4 the districts have clearly recognized cost effectiveness as a 5 primary criteria to selecting projects. 6 CHAIRMAN DUNLAP: Is it -- it may be an unfair 7 question, but is it largely, the ways to go, are the larger 8 districts more in synch, or the smaller one's more in synch? 9 I mean you are going to be asked to continue to 10 provide some technical assistance and guidance, I would just 11 like a flavor of where the emphasis maybe needs to be 12 placed. 13 We have some witnesses coming up. We have a 14 handful that have signed up. 15 I would like to press them. Also, we have some, as 16 you well know, Lynn, we have Board Remembers who represent 17 small, large, medium sized districts here on this Board. 18 And then Ron, I will give you a second. 19 MS. TERRY: Okay. I think, for the most part, the 20 districts have balanced the multiple needs. 21 They are different from the other recipient 22 agencies in that under State law there are two aspects of 23 spending money. 24 They have programs to support, and they have 25 emission projects to fund. We show that they are spending PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 56 1 over half of the money on projects. 2 That really is what we are focusing on now, looking 3 at those project dollars, are they well spent? 4 The estimate we had was that 65 percent of the 5 projects met the cost effectiveness criteria. So, just 6 looking at the numbers alone you can see there is a fair way 7 to go. 8 I think part of the improvement that is in the 9 works is that districts are trying to focus more on a 10 comprehensive plan for spending the money that may span 11 several years. 12 There is an increased focus on cleaner vehicle 13 purchases, the heavy duty trucking sector given PM 2.5 and 14 the future, the continuing need for NOX control. 15 I think there is a strong recognition by the 16 districts that they need and want to move in that direction 17 and the actions taken on this fiscal year are clearly very 18 positive. 19 The smaller districts, that is where most of the 20 money is focused on program needs, staffing needs, they have 21 more of a budget problem, to be quite honest. 22 CHAIRMAN DUNLAP: So, the local districts are using 23 the majority of the resources in-house to pay for program 24 elements? 25 MS. TERRY: Some of the smaller ones are. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 57 1 The larger districts are not however. They are 2 well within our 50 percent criterion. 3 CHAIRMAN DUNLAP: Okay. 4 Did you look at how the interaction between the 5 districts providing technical assistance to the cities and 6 the counties to get these dollars, is that going well? 7 Is there a dialogue? Are they listening? 8 Or is the money just being stockpiled? What is 9 going on? 10 Can you -- anecdotal information is helpful to 11 me. 12 MS. TERRY: I think -- that is where we have a 13 ways to go. 14 The last report that we did two years ago, there 15 was a very clear problem with cities and counties not having 16 spent the money. 17 They had lot of small cities receiving $30,000 and 18 $40,000. So, there has been progress made in terms of saving 19 that money up for larger projects. 20 We tried to encourage the cities and counties to 21 work together on joint funding of larger projects and so on. 22 Not a lot of that has happened. So, I think we 23 have made a little progress with cities and counties, but not 24 a lot and again the numbers indicate that. 25 CHAIRMAN DUNLAP: Okay. I will come back to that PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 58 1 in a minute. 2 Supervisor Roberts. 3 BOARD MEMBER ROBERTS: Thank you, John. First of 4 all, from my perspective in serving on a local air board, I 5 felt like this Report was describing exactly what is 6 happening in our district. 7 I don't know how you classify us large or -- 8 CHAIRMAN DUNLAP: Very large. San Diego is very 9 large, Ron. 10 BOARD MEMBER ROBERTS: Thank you, John. 11 The Report is very accurate, and I think that maybe 12 the one thing that is absent is that I think there is as much 13 a political problem as there is a technological problem. 14 If you look, and I think you hit the nail right on 15 the head when you said some of the things being funded are 16 things that people like, they are popular, but they don't 17 necessarily have a large impact, if any effect at all on air 18 quality issues, unfortunately. 19 What we have seen is a tendency to fund those. It 20 is hard to argue with bike paths even if they have nothing to 21 do with a commute and are 100 percent recreational. 22 There will be one biker out there who will swear up 23 and down that he was using it for work and that would become 24 the justification, and it is hard to argue with that. 25 It's hard to argue for certain types of things, for PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 59 1 instance, for seniors and others from a political 2 perspective. 3 The one disturbing thing that I have seen, and you 4 have also touched on that, is the, at least in our area, is 5 an increasing pressure to get into research areas where we 6 have a staff that is not qualified, and we have got a Board 7 that is not qualified to be able to make fundamental 8 decisions as to whether it even makes sense. 9 I mean, they are made for political reasons having 10 to do with how many employees, what part of the county and 11 what have you. 12 I guess what I concluded when I read and listened 13 to your Report is I think there is a significant amount of 14 money that is going down the drain with respect to air 15 quality issues, and I think that it would help if there could 16 be something stronger than just guidelines and technical 17 support, to be honest with you. 18 I am disturbed, because I know that in spite of the 19 fact that we have been able to change over one-third of our 20 buses now to cleaner burning natural gas buses, there is 21 still among some Members almost an anti-transit feeling like 22 that is wasting money, and we have got to do other things. 23 The guideline of $20,000 per ton is seldom spoken 24 of on a local level. It is mentioned, but then it is, well, 25 who cares. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 60 1 I'm just sharing, I agree with your Report, I liked 2 the Report, I think it is right on target from my own 3 experiences. 4 My concern, I guess, is that somewhere, somebody is 5 going to have to toughen up, quote, unquote, the guidelines 6 if you are going to achieve in a more meaningful way the 7 results that we are seeking out of these dollars. 8 CHAIRMAN DUNLAP: Yes. I personally appreciate 9 that view. 10 I mean one of the things, Ron, we kid you from time 11 to time, but you have always been very focused on defensible 12 expenditures of public dollars. 13 I think that this is an area that we maybe need to 14 spend some more time to help the locals, not to dictate, to 15 state priorities per se, though we know pretty much where the 16 emphasis ought to be placed as we look in our emissions 17 inventory and our priorities. 18 Joe, you had a similar -- 19 BOARD MEMBER CALHOUN: I have kind of followed this 20 project for the last several years, so my questions were very 21 pointed because I know what has happened in some districts. 22 I guess to keep this issue in the public's eye and 23 maybe we ought to ventilate it, I guess that I would like to 24 see a report every year, just telling what is happening in 25 the local districts. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 61 1 You can't dictate to the local districts, but I 2 would think that adopting some criteria and encouraging them 3 to really focus on it will at least keep some pressure on 4 them to try and abide by the suggested guidelines. 5 CHAIRMAN DUNLAP: Well, I didn't see any staff 6 hands shooting up to say, we will do it. 7 MS. TERRY: We will do it. 8 CHAIRMAN DUNLAP: Ron, and Mr. Kenny and then 9 Supervisor Silva. 10 BOARD MEMBER ROBERTS: Just one last thought, if 11 there were a way for us to maybe recognize the real 12 successful projects and identify those, and maybe even a way 13 to identify the really bad one's, so that perhaps, as a 14 Board, the political repercussions of that would reverberate 15 also in some of those communities. 16 There may be other ways, short of having mandatory 17 requirements, but right now I don't think that the goals in 18 here are, at least in our area, are even given lip service. 19 CHAIRMAN DUNLAP: Yes. Okay. 20 Mr. Kenny, you wanted to respond relative to the 21 feedback to the Board, that annual report. I know it takes 22 significant staff time, and I know some of my Board Member 23 colleagues had advanced briefings on this issue. 24 I know, Lynn, you know when we hired you to do 25 planning and being an auditor is not something that you are PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 62 1 necessarily looking forward to doing every year, but I think 2 you are hearing, Mike, that some people want to see some 3 regular feedback. 4 MR. KENNY: We don't disagree. 5 We actually think that there are significant funds 6 here that are being utilized and, in fact, the more effective 7 that those funds can be utilized the more air qualities 8 benefits we can get. 9 We think that the idea of doing the annual report 10 is fine, maybe even with the 10 best and 10 worst projects 11 identified within it, there is a way of highlighting what is 12 good and what is bad. 13 One of the things that we were hoping the Board 14 would also provide direction to us on was the fact that we 15 would establish a working group. 16 The idea of the working group really was to provide 17 some greater uniformity throughout the State with regard to 18 how these projects are being funded in a cost effective 19 fashion, because if we can get that then we have a mechanism 20 in which the guidelines that we would establish would be 21 really implemented in a fairly straightforward fashion. 22 If we saw substantial deviations from those 23 guidelines, such as cost effectiveness was not a criteria, 24 then there are other options always available. 25 One quick follow-up comment on that. The districts PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 63 1 have actually made great strides. 2 A great level of our concern has been substantially 3 diminished there. The cities and counties, however, need 4 more work. 5 That is a place where we really think that the 6 working group could have some substantial impacts. 7 CHAIRMAN DUNLAP: Yes. Okay. 8 When we get to the witnesses in a couple of minutes 9 we will ask them about this working group and get some ideas 10 there. 11 Supervisor Silva and then Barbara Riordan. 12 BOARD MEMBER SILVA: Thank you, Mr. Chairman. 13 I do agree with our Report, and I also agree with 14 Supervisor Roberts from San Diego. 15 We have many of the same concerns of the South 16 Coast District. I know that many times we receive letters 17 that suggest that perhaps there are millions of dollars going 18 out for projects without clear direction or scope. 19 I think maybe some of the problems are in the 20 questions that we don't ask rather than the questions that we 21 do ask. 22 I do know that the surcharges have really enabled 23 our district to do some vital monitoring that would not take 24 place. 25 I think that planning and enforcement activities PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 64 1 are also very crucial for Southern California. 2 CHAIRMAN DUNLAP: Right. So, you are saying there 3 is a balance of how these -- it depends on the district, but 4 there needs to be some thought given to the balance of how 5 much they allow for grants and how much they use in-house, 6 for example. 7 BOARD MEMBER SILVA: Absolutely. 8 BOARD MEMBER RIORDAN: I had a question, Mr. 9 Chairman for maybe the staff. 10 Sometimes large programs, and I consider this a 11 large program, in order to promote efficiency, reward that 12 efficiency by holding some money in a pot that goes back to 13 the governmental agency for reward for the efficient use of 14 money, or whatever the program is. 15 One of the big ones that I can think of is the Job 16 Training Partnership Act. At one time, and I think they 17 still do, those agencies that administered those funds and 18 had a tremendous records of employment and the longevity of 19 that employment, at the end of the year got rewarded by some 20 additional funds to add to their projects. 21 That is one of the ways to get some of the more 22 independent cities and counties to really come together if 23 you have some sort of a reward. 24 I just offer that. I don't know if that's 25 allowable, but it certainly worked with job training PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 65 1 partnership money. 2 CHAIRMAN DUNLAP: So, an incentive. 3 BOARD MEMBER RIORDAN: It was like a big incentive. 4 MR. KENNY: I'm not sure we can do it right now. 5 I'll have to double check, but I think it would 6 require a Legislative change to allow for that kind of a 7 process, but we can look at that. 8 BOARD MEMBER RIORDAN: That was great way to 9 motivate people. 10 CHAIRMAN DUNLAP: On that point, I know there are 11 going to be some local districts that have Legislative fee 12 issues that are going to emerge this year. 13 I have been hearing some things. Perhaps, Mike, 14 there might be a way for us to talk about an incentive 15 amendment or something. 16 I don't want, you know, the locals are getting 17 ready to speak, and I don't want the point lost on that and I 18 don't think it is. 19 I want to emphasize that there is a lot of pressure 20 at the State level, particularly in the Legislative arena, 21 that we defend local dollars for districts, while we are 22 willing to do that we are not going to be an apologist for 23 money spent improperly. 24 That becomes increasingly difficult for us to do 25 and I can tell you that some of the locals know this well. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 66 1 Some of the larger industries in this State have 2 pushed for larger State programs where these dollars would be 3 used, for example, scrappage and some other things. 4 So, we need to show that we are getting cost 5 effective use. 6 But, what I would like to do, Lynn, I am going to 7 give you just a second, I would like to get the witnesses 8 lined up so we can move through them fairly quickly. 9 We have four district representatives that I ask to 10 come forward and sit in the front row. Oscar Abarca, from 11 South Coast District, Edward Miller, from the Bay Area 12 district, Norm Covell, from the local Sacramento Metropolitan 13 AQMD, Mark Boese, from the San Joaquin Valley Unified, APCD, 14 and I believe Mark is also the CAPCOA President this year. 15 Mark, I will let you, because of your status as the 16 head of CAPCOA, I'll let you go first, or allow you to broker 17 who in your group there goes up in what order. 18 It is a hell of a responsibility, you know. 19 MR. BOESE: Mr. Chairman and Board Members, thank 20 you very much for to opportunity to come before you today, I 21 appreciate that very much. 22 As your Chairman said, my name is Mark Boese, and I 23 am the Deputy Air Pollution Control Officer for the San 24 Joaquin Valley APCD, and currently I am the President of the 25 California Air Pollution Control Officers Association. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 67 1 There are just a couple of comments that I want to 2 make. I want to take us back in history a little bit to 3 think about the intent of the Legislation that gave us this 4 DMV surcharge. 5 My recollection is that when it was originally 6 passed and signed by the Governor was to help offset the cost 7 of the running of the air pollution control districts and 8 move some of that responsibility away from the stationary 9 sources who had been paying permit fees and were continually 10 having to be faced with increased fees as the 11 responsibilities of the district increased. 12 So, if you look at the amount of pollution that 13 comes from the automobile, and depending on which district we 14 are looking at, whether it is 40, 50, 60, 70 percent, it felt 15 that it made sense for them to help carry the load. 16 So, I think that was the original intent of this 17 Legislation. The grant part of that is where it came out 18 later. 19 Speaking of the grants, that is other part that I 20 wanted to mention, is the districts when we had this money 21 available to us, it started out to where we could pick the 22 amount of money we wanted per vehicle, whether it was one 23 two, three, or up to four dollars. 24 A lot of the districts started out at the lower end 25 and moved up the scale where, I think, probably the majority PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 68 1 of them now are collecting the four dollar fee, which 2 statewide amounts to a lot of money as your staff has talked 3 about. 4 As the districts got into the grant program, we 5 were new at this, this was money coming in that we had not 6 had an awful lot of experience in developing grants and 7 overseeing those. 8 So, I think we have learned a lot. We have come a 9 long ways in the last several years. 10 I appreciate Mike Kenny's comment that we have made 11 progress. I think we have and a lot of that is due to 12 working with the Air Resources Board and their staff. 13 We have developed guidelines that we feel the 14 districts are following. Another comment that was made is 15 the data that is being used to make this comparison is the 16 guidelines are somewhat new. 17 I think down the road you will see that percentage 18 of cost effectiveness numbers will go way up. 19 We have learned in San Joaquin Valley as far as the 20 issuance of our money. We continually hone our guidelines, 21 our Board reviews those guidelines every year and makes 22 changes to those guidelines again as we gain experience and 23 knowledge on how best to allocate those funds and how they 24 can help us reduce emissions. 25 The one point that I will leave you with is as you PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 69 1 compare the districts and the cities use of the money, I 2 think that the cities have been working a lot closer with the 3 ARB and have improved. 4 I don't want the districts to get lumped in with 5 the cities in the fact that it may take away some of our 6 flexibility. 7 We believe that our Boards know best what to do 8 locally and we would like to continue to have that 9 flexibility to spend that money. 10 CHAIRMAN VALDES: Mark, can I ask you a question 11 about the kind of -- whose responsibility it is to work with 12 the local municipalities and counties? 13 Not to say that it is completely yours or 14 completely ours. 15 Are the local districts, from what you have been 16 able to ascertain, stepping up to the plate relative to 17 technical assistance and having relationships with the 18 communities, the cities in their area or is there a lot more 19 work that needs to be done from your view? 20 MR. BOESE: I think we have come a long ways in 21 working with the cities. We work a lot with the COGs. 22 In our valley we try to work with the COGs and 23 direct city and county progress though the COGs to help them 24 coordinate that and then the COGs act as a clearing house in 25 supporting those projects and then come to our Review PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 70 1 Committee. 2 CHAIRMAN DUNLAP: And it is working well? 3 MR. BOESE: We think it is working well. 4 As you know there is always conflicts between the 5 district, and the COGs, and the cities and so forth, but I 6 think overall that relationship is improving. 7 CHAIRMAN DUNLAP: Very good. Barbara, we have a 8 rep from your district. 9 Is there anything you wanted to add or subtract 10 from that? 11 BOARD MEMBER PATRICK: It just makes me glad that 12 our district is doing such a great job. 13 I know that we are, because cost effectiveness is 14 always our number one criterion. 15 CHAIRMAN DUNLAP: Okay. Great. 16 Thank you, Mark. I appreciate that. 17 Yes. Ms. Edgerton. 18 BOARD MEMBER EDGERTON: When you work with the Air 19 Resources Board staff, or when you see the staff work with 20 the cities or the counties, and there may be extra money left 21 over, a small area, do -- does the Board come forward, does 22 the staff come forward with proposals that might make sense, 23 that we already know are effective, for example, small, 24 medium and large, we know that if you have a $100,000 it 25 makes sense to spend it on a natural gas bus, or do you find PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 71 1 that we have the kind of menu of cost effective ideas quickly 2 available to help? 3 MR. BOESE: Well, I think it is not necessarily 4 coming from the staff of the Air Resources Board. 5 I think a lot of this information is coming from 6 the individual districts as we fund these projects and that 7 information comes back and then we work with the Air 8 Resources Board to line up those cost effective projects and 9 then make that data available. 10 I think a lot of the good data is coming out of 11 these projects. Like I said, as we get further down the 12 road, we are doing a better job of weeding out some of the 13 bad projects and focusing in on those where we are getting 14 the biggest bang for the buck. 15 Maybe I should say my experience with districts and 16 our DMV Committee, which is made up of representatives from 17 the different air districts and the Air Resources Board, sit 18 down and work a lot of this out. 19 To my knowledge there hasn't been a lot of 20 interplay with the cities on that. 21 CHAIRMAN DUNLAP: Mr. Parnell. 22 BOARD MEMBER PARNELL: I wanted to ask a question 23 of the staff as to whether or not your idea of Legislative 24 history comports with Mark's? 25 CHAIRMAN DUNLAP: Yeah. Joe and I were going to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 72 1 ask Kathleen. 2 Kathleen, I am more than willing to put you on the 3 spot. 4 What I think that I would like to do is hold that 5 question and give you a chance to consult with your team and 6 then at the tail end of the witness list, I'll have you come 7 back and give us a more complete answer. 8 Are you okay with that, Jack? 9 BOARD MEMBER PARNELL: Sure. 10 CHAIRMAN DUNLAP: Okay. That's what we will do. 11 BOARD MEMBER EDGERTON: You at the district are 12 aware of how many, of how much money each of your counties 13 and cities are getting that might be available for 14 expenditure. 15 You know if they have got extra money banked that 16 haven't spent, and how they are spending it, and then to the 17 extent that they have extra money, or maybe they are not 18 doing it well, you are having meetings with them to share 19 your wisdom about what would be best for the air pollution 20 control strategy? 21 MR. BOESE: Maybe I need to clarify a fact. 22 Most of the air districts, the money comes to them 23 wholly and they distribute the money then based upon the 24 projects that their Board finds cost effective. 25 Now, in the situation of the South Coast and the PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 73 1 Bay Area, it is different where there is already a prescribed 2 amount of money that goes to directly to the cities and 3 counties and an amount that goes to the air districts. 4 So, the air districts don't have control over that 5 money that goes to the cities and the counties. Now, that is 6 my understanding, I am not that familiar with it, because in 7 the San Joaquin Valley the whole pot of money comes to the 8 district. 9 BOARD MEMBER EDGERTON: Okay. I'm sorry. 10 I'm from the South Coast and that does not work 11 down there. 12 MR. KENNY: If I could, Ms. Edgerton, that is 13 basically, as Mark described it, the sort of the distinction 14 between the cities, and the counties and the districts. 15 The primary city and county issues that we have 16 identified have been in the South Coast where there are a 17 large number of cities in the South Coast that receive funds 18 directly and those are funds that we think could be more 19 effectively utilized. 20 BOARD MEMBER EDGERTON: It is really only there. 21 CHAIRMAN DUNLAP: We have a South Coast rep, I'll 22 ask him to come up, but Supervisor Patrick wants to ask a 23 question. 24 BOARD MEMBER PATRICK: If I could just make a 25 comment, you were talking about how these dollars become very PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 74 1 political and so forth. 2 I know that there is some pressure on our district 3 when a city or county repeatedly does not rise to the top 4 when these dollars are being given out. 5 So, our district has worked very hard with some of 6 these cities to say, please improve the quality of what you 7 are asking for. 8 We want to spread this throughout the district and 9 so forth, but if we are not getting the quality of proposal 10 that we need then you are not going to be funded. 11 That seems over the course of time to have improved 12 quite a few of the requests for dollars, because when your 13 city or county is repeatedly not being funded, you begin to 14 get the idea that maybe you are doing something wrong and you 15 need to improve the quality of that proposal, so that really 16 helps to take the politics out of it. 17 CHAIRMAN DUNLAP: Well, also, there is some limited 18 ability you have to actually to withhold the dollars. 19 For some joint projects, I think that you would 20 have that ability. 21 Good. Okay. 22 With that, I will ask Oscar Abarca to come up from 23 South Coast, and Ed Miller and then Norm Covell, and I just 24 had another card that will be here in minute. 25 MR. ABARCA: Good morning, Mr. Chairman and Members PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 75 1 of the Board. 2 For the record, my name is Oscar Abarca, Director 3 of Government Affairs for the South Coast Air Quality 4 Management District. 5 I welcome the opportunity to speak before you this 6 morning. I would like to first read my statement and then 7 make myself available for any questions that you might have 8 relative to what we do with the AB 2766 funds at the South 9 Coast Air Quality Management District. 10 The South Coast Air Quality Management District's 11 staff supports ARB staff's recommendation to establish a 12 statewide working group to develop consensus and guidelines 13 for the expenditure of AB 2766 DMV surcharge fee funds. 14 In fact, we consider it absolutely vital that the 15 Air Resources Board, in conjunction and in cooperation with 16 local air districts and local governments, convene this 17 working group to enhance the effectiveness and to achieve a 18 more quantifiable measure of success for the use of these 19 funds. 20 We also concur with the ARB staff's assessment that 21 the South Coast AQMD should continue to provide technical 22 assistance to local governments in an effort to further raise 23 the level of cost effectiveness of the AB 2766 projects. 24 We support adoption of criteria that support the 25 use of these monies on measures that implement the Clean Air PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 76 1 Act. 2 We also support adoption of post criteria to 3 encourage the leveraging of these monies. AB 2766 fees 4 provide a critical funding source for local governments and 5 air districts to fulfill the Federal and State clean Air 6 requirements. 7 In the era of diminishing public funds and mounting 8 mandates the AB 2766 program enables our agency to do vital 9 monitoring, planning and enforcement activities. 10 It also enables local governments to continue to 11 reduce emissions for mobile sources which account for a 12 significant share of the air pollution in the South Coast Air 13 Basin. 14 The South Coast Air Quality Management District's 15 staff intends to continue to provide AB 2766 technical 16 support to the cities and local jurisdictions. 17 To conduct AB 2766 workshops in the four counties 18 of the South Coast Air Basin, Los Angeles, Orange, Riverside 19 and San Bernadino Counties, where the use of the AB 2766 20 funds would be discussed. 21 To update on an annual basis the list of matching 22 fund sources for cities to leverage their AB 2766 funds, to 23 provide assistance to cities in determining cost effective 24 projects and to serve the local jurisdictions on a more 25 frequent basis, possibly on a quarterly basis, requesting PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 77 1 updated information under obligated and unobligated fund 2 balances. 3 Much progress has been made at the South Coast Air 4 Quality Management District with respect to use of these 5 monies, but we also recognize that we still have a lot more 6 work to do. 7 We believe that implementing these recommendations 8 will improve the program in a complementary manner with ARB 9 staff activities. 10 In conclusion, we strongly urge the Air Resources 11 Board to expedite as quickly as possible the work of the 12 proposed task force. 13 We urge formation of this task force within the 14 next couple of months with final recommendations coming to 15 you by April, perhaps in a six month window to do the work. 16 The sooner new funding criterias are developed the 17 better for the sake of local governments in making such 18 awards next year. 19 Also, since there have been questions from the 20 Legislature about the effectiveness of this program, it is 21 important to show early next year that positive changes have 22 been made to provide local governments with guidelines to 23 improve the cost effectiveness of the program and to 24 emphasize measurable emission reductions. 25 In closing, Mr. Chairman, I just want to publicly PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 78 1 acknowledge my appreciation for the support that your staff 2 has provided both the local governments in the South Coast 3 Air Basin as well as our district in making significant 4 improvements in the administration of this program. 5 I would like to acknowledge Ms. Lynn Terry, Pam 6 Burmich, Roberta Hughan and Gary, and last, but not least, 7 Mr. Chris Reynolds who has always made himself available to 8 help us and to give us guidance. 9 I make myself available for any questions you might 10 have. 11 CHAIRMAN DUNLAP: Anything, Jim, that you want to 12 add or subtract? 13 BOARD MEMBER SILVA: I wanted to also let you know 14 that we appreciate the work that he has done. He has really 15 worked well with the staff up here. 16 I know that there is a lot of duplication that goes 17 on in government, and we are trying to eliminate as much of 18 that as we can, and Oscar has been at the forefront. 19 CHAIRMAN DUNLAP: I also should acknowledge, and I 20 think this came up during my briefing on this item, South 21 Coast gets a lot of money, because they have a lot of people 22 down there. 23 I know there are a lot of people competing, you 24 know, a lot of cars, a lot of competition for those dollars. 25 I think it was a year or two prior to my leaving PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 79 1 that district that I saw the effort that went into trying to 2 educate the folks who would compete for the dollars as well 3 as educating the cities. 4 So, I think they have done a good job, but I 5 appreciate your willingness to work with us and support going 6 further to provide defensible criteria and the like to make 7 it more effective. 8 Any questions of this witness? 9 Help me out here, Lynn. $78 million statewide, 10 South Coast gets about $38 million, or so, is that about 11 right? 12 MS. TERRY: It is about $85 million this year, 13 statewide. 14 Oscar, you know what your district gets. 15 MR. ABARCA: The South Coast receives approximately 16 $40 million. 17 CHAIRMAN DUNLAP: $40 million. Okay. 18 So, a little under half. All right. 19 Very good. Thank you. 20 Lynne. 21 BOARD MEMBER EDGERTON: You remember the earlier 22 question, do you maintain a list of a suggested projects, 23 small, medium and large that you make available to the cities 24 and counties when you have these work shops? 25 MR. ABARCA: Yes, we do. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 80 1 We have suggested uses, a set of guidelines that 2 identify suggested uses of these monies, and whenever we host 3 a workshop we always invite your staff to make presentations 4 in the areas of cost effectiveness and eligible uses of the 5 funds. 6 BOARD MEMBER EDGERTON: So, why is it as low as 65 7 percent? 8 Is it because it is still holding over with some 9 older proposals? 10 Because my recollection, Mr. Chairman, under your 11 leadership, a couple of years ago we adopted these 12 regulations, well, this guidance, that is a very important 13 difference, and it was at a time when there was tremendous 14 pressure at the Legislative level with respect to the South 15 Coast expenditure. 16 CHAIRMAN DUNLAP: Well. Right. 17 Well, because South Coast had a significant amount 18 of dollars. I think the issue is of the 65 percent, and that 19 didn't strike me as, converse, the 35 percent seemed to be a 20 lot. 21 That may or may not be the case in South Coast. It 22 may be better than that. 23 I think Mark Boese hit the key point, which is we 24 need to continue to make progress and establish better 25 working groups and the dialogue. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 81 1 One thing, too, I don't know if Stu Wilson is here, 2 but I have had some conversations with Stu, he's in the back, 3 he's a CAPCOA Executive Director, at different times about 4 the Legislature asking us questions about are these dollars 5 making a difference, how do we feel about their 6 expenditures? 7 We, I think, collectively as a Board, want to tell 8 them on behalf of the district and ourselves that it is being 9 spent well, and it is defensible, and they are getting bang 10 for those dollars, and to the extent that that is not 11 happening, we need to collectively work to make it defensible 12 and to make it as airtight as possible. 13 I am hearing that people want to do that and that 14 is very important, but, you know, there is a lot of money 15 going there and this Legislature, and our Governor, of 16 course, is interested in making it go as far as it can, so I 17 appreciate those remarks. 18 BOARD MEMBER EDGERTON: I have one other question. 19 Do you get calls from the Legislature? 20 I am interested in the context. Do you get calls 21 from Sacramento, from the Legislators asking you to spend 22 money in a particular way or asking you to approve particular 23 projects? 24 Do you get a lot of lobbying coming down here as 25 well as the other way? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 82 1 MR. ABARCA: We don't receive any inquiries or 2 requests from Legislators with respect to the money that goes 3 to the local governments. 4 There have been some inquiries made by Legislators 5 with respect to the money that is under the authority of 6 Mobile Source Reduction Review Committee. 7 That is the discretionary portion of the money. 8 CHAIRMAN DUNLAP: Grants. 9 MR. ABARCA: So, we do receive inquiries from time 10 to time from Legislators with respect to that one component. 11 CHAIRMAN DUNLAP: I would imagine you get a support 12 letter or a call on an individual project. I don't think 13 that they have been involved all that much. 14 MR. ABARCA: As correspondence. 15 CHAIRMAN DUNLAP: Okay. Thank you. 16 Ed Miller, Norm Covell and Barbara Lee. 17 MR. MILLER: Good morning. 18 My name is Edward Miller. I'm with the Bay Area 19 Air Quality Management District in San Francisco. 20 I, like Oscar, I am going to read what I have put 21 down. It is not going to take that long. I am the Principal 22 Administrator of our Transportation Fund for Clean Air. 23 We had to give the DMV fees a name because we have 24 a different piece of Legislation. Ours is AB 434. So, we 25 gave it a name, Transportation Fund for Clean Air. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 83 1 These funds have provided our agency with a 2 mechanism to fund eligible transportation and mobile source 3 projects that result in a reduction of emissions from mobile 4 sources. 5 To date we have awarded funding to over 700 6 projects that will result in a reduction of more than 77 tons 7 of ozone precursor emissions from motor vehicles over the 8 life of these projects. 9 These funds have influenced the types and design of 10 projects within our region. We believe that the majority of 11 these projects would not have been funded if they did not 12 receive the funding contribution of the TFCA funding. 13 Our funding is allocated through two processes. 60 14 percent of it is controlled by the Air District, and we call 15 those our regional funds, our Air District Board every year 16 has adopted review and evaluation criteria, and we rank and 17 score the projects that we get. 18 That review and evaluation criteria has always had 19 cost effectiveness as its most principal way of getting 20 points. 21 So, the more cost effective your project was the 22 greater you were assured of being funding through that 23 source. 24 We believe that our review and evaluation process 25 has worked extremely well, because as you know, we always get PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 84 1 more applications than we have dollars to give away. 2 This is an excellent way of ranking the projects 3 and saying, well here we have run out of money, that is it. 4 That worked very well, and we have been through six 5 funding cycles with our Board on that process. The other 40 6 percent of our money within our region is returned to the 7 county of source to designated program manager. 8 Many of our program managers, we have been working 9 with them closely over the years and many of them now are 10 considering, well all of them are calculating cost 11 effectiveness for their projects beginning with the F 197 12 projects, and many of them are taking that into consideration 13 in their project selection process. 14 All of our county program manager projects that 15 they put forth for funding come to our Air District Board for 16 review and approval. 17 That approval happens before we execute any fund 18 transfer agreement to those county program managers. 19 We believe that we have developed successful 20 processes to assure that eligible projects do receive 21 funding. 22 We have worked successfully with ARB staff as well 23 as other district staffs in sharing our ideas and developing 24 the guidelines that we already have, and we have been 25 implementing and we are certainly available to work with ARB PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 85 1 staff on any additional guidance that is needed. 2 I know you are going to ask me some questions, and 3 I welcome that, but a couple things, our Legislation is very 4 unique in the State, because all of our money is basically 5 project money. 6 There is a list of eligible project types written 7 right into our law. So, in a way that is kind of a blessing, 8 because if your project is not on the list, we can't really 9 talk to you. 10 Like you know, there is always more projects than 11 there are monies. So, in many ways, we function in a 12 somewhat unique environment. 13 The program managers, the CMAs in our region, they 14 are constrained, too. Their projects must be on that list of 15 eligible projects. 16 So, a lot of the situations that you may see in 17 other parts of the State, I don't think that you will see in 18 our region. 19 One thing that did come up there were questions 20 about the cities in the South Coast District not allocating 21 money to projects, I can assure that our program managers 22 every year have allocated all of their money to projects and 23 implemented those projects. 24 Of course, there is also always some projects that 25 don't happen, so there a certain amount that is unallocated, PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 86 1 but it is very, very small compared to the total amount of 2 money. 3 Anyway, I will be happy to answer any questions. 4 CHAIRMAN DUNLAP: Sure. 5 Supervisor DeSaulnier, do you have anything to add 6 or subtract? 7 BOARD MEMBER DeSAULNIER: I think that it is 8 interesting to hear that our problems are not dissimilar from 9 other jurisdictions in the State, but I think our problems in 10 regards to CMAs is in your written testimony, Edward, you 11 mentioned that many of the county programs are now utilizing 12 cost effectiveness, but you just orally said that they all 13 are. 14 MR. MILLER: Well, what I said was they all, we 15 calculate the cost effectiveness of all the projects that 16 they consider. 17 We have given them the tools to do that, we assist 18 them in doing that. The point that I was trying to make is 19 that many of them don't utilize that information in their 20 project selection process. 21 So, in other words, they decide upon a project and 22 then we calculate the cost effectiveness for it. Sometimes, 23 some of our program managers will look at the cost 24 effectiveness before they decide, but it won't have any 25 bearing on how they rank or select those projects. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 87 1 CHAIRMAN DUNLAP: Have there been abuses? 2 MR. MILLER: I don't believe we have abuses, 3 because another thing that helps us in that respect is that 4 it has to be an eligible project. 5 CHAIRMAN DUNLAP: On that list, originally. 6 Yeah. Okay. 7 MR. MILLER: That is very beneficial to us. 8 BOARD MEMBER DeSAULNIER: I think our challenge, 9 and correct me if I am wrong, is the communication with the 10 CMAs and getting them to realize that there is a nexus 11 between air quality and building roads. 12 We call them congestion management authorities, but 13 that is not always what they actually do. So, what I am 14 curious about is not unlike what Supervisor Roberts 15 mentioned, is how we have a gentle hammer to get the local 16 counties to be more cooperative. 17 MR. MILLER: Well, that is exactly the situation, 18 and the question that came up before, where this Board cannot 19 dictate how the air districts do it. 20 We cannot dictate to our program managers that they 21 must do it this way. We can try. 22 I think we have come a long ways since we started, 23 because when we started working, administering this program, 24 where the 40 percent return to the counties isn't 25 entitlement, it's very specific in our law, I think we were PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 88 1 very successful in getting the program managers to buy into 2 the fact that they had to develop an expenditure program for 3 these funds that our Board had to approve before we would 4 send them a check. 5 That is a different process than we have in other 6 places. Our Board does review and sometimes has rejected 7 some of their projects. 8 They do it with discretion, but with respect to 9 cost effectiveness, when we hear the $20,000 per ton that has 10 been recommended, or put forth out there, this is a very low 11 number. 12 More than half of our projects in 1997, the 13 regional fund projects achieved that level. However, there 14 are a lot of projects that are eligible in our region that 15 cannot achieve that, that are good for air quality, serve 16 multiple purposes, and they are politically popular, as the 17 gentleman from San Diego said. 18 I mean shuttle projects are an excellent example of 19 that, where shuttles are just expensive, but shuttles do in a 20 lot of situations provide a vital link between a fixed rail 21 service and employment sites. 22 If you talk to the people who run CalTrans, they 23 will tell you that their increase in ridership is directly 24 attributable to the 25 shuttle projects that they are 25 running. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 89 1 So, you do want to continue to participate and 2 encourage that effort. It cannot achieve the $20,000. 3 So, there is a certain danger in setting a 4 diminimous level like that. That is one of the things that 5 we talk about a lot with the ARB staff. 6 CHAIRMAN DUNLAP: Well, we understand the danger, 7 but there is also a danger in a piece of Legislation moving 8 forward to dramatically change how local jurisdictions, 9 regardless of their existing authority, how they currently 10 derive those dollars. 11 So, I appreciate that. I understand that you have 12 different Legislation, but I wanted to be very clear with 13 you, and I see Ellen back there, that we are in this 14 together. 15 We need to make sure that we sing the same tune to 16 the extent that we can. Thank you. 17 Mark, anything else? 18 Okay. Very good. 19 Two remaining speakers. Norm Covell, from the 20 Sacramento Metropolitan Air District, and Barbara Lee. 21 MR. COVELL: Good morning, Chairman Dunlap and 22 Members of the Board. Norm Covell, here, Air Pollution 23 Control Officer for the Sacramento Metropolitan Air Quality 24 Management District. 25 I do not have any written text. I did not plan to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 90 1 speak this morning, but based on some comments that were made 2 earlier and some questions that were asked, I felt a call. 3 A little bit of history, I think, is in order 4 here. Mark talked about the basis for Legislation that 5 brought about the surcharge revenues. 6 Within Sacramento it happened under a different 7 Legislation. There were actually three pieces of Legislation 8 that got this revenue available for districts statewide. 9 In the Sacramento area it happened first. It was 10 two years ahead of the other Legislation that went through. 11 I am compelled to put a little different spin on 12 the purpose of the money from what Mark talked about. 13 The timing of 2766 for the majority of the 14 districts in this State was right on the heels of the 15 California Clean Air Act passing and it was felt at that time 16 that there was benefit to shore up district resources in 17 order to take the lead in developing plans and then to 18 implement the strategies that came out of those plans, hence 19 2766 for that purpose. 20 In the case of Sacramento, it was more focused on 21 educating the public regarding the air quality problem that 22 we have in Sacramento, inasmuch as 70 percent of our 23 hydrocarbons are from mobile sources and over 90 percent of 24 our nitrogen oxides here are mobile sources, something needs 25 to be done with the fleet once it hits the road and is PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 91 1 operated over time. 2 The four dollar figure actually came from 3 somebody's calculations as to what it would take to 4 incentives and pay the incremental difference of getting 5 100,000 vehicles running on methanol in Sacramento, that's 6 how we hit on four dollars. 7 Then that was picked up statewide and has gone to, 8 as we all know, a number of different uses. We have a 9 program that I think is operated quite successfully, because 10 we have seen the need to bring on the talent and expertise 11 that we haven't had ourselves to make this effective. 12 Supervisor Roberts talked about the lack of 13 technical capabilities on staff to do the job right, and we 14 went out and got it under a contract and also utilizing the 15 expertise from Tom Cackette's mobile source people, I think 16 we have been successful in that regard. 17 In marketing our projects, we didn't know how to do 18 that. We were basically regulation enforced. 19 So, we have a contract now with public relations 20 and marketing firms that are helping us make these projects 21 successful and in marketing the air quality problem. 22 Also, educating the people in Sacramento has been a 23 big piece of what we have had to do since this Legislation 24 went into place. 25 I'd like to direct Chairman Dunlap's question about PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 92 1 how vulnerable are we with this money and have we got it 2 protected, and you said that we need to. 3 My answer to that is I think we will continue to be 4 very vulnerable, and I don't think we can ever have it 5 protected to the extent that we need to. 6 I sit on the INM Review Committee as the Governor's 7 appointee, and we work through the Legislation which is 8 signed by the Governor that contains some compromises 9 regarding that program. 10 There was a time when this DMV money was considered 11 as a potential source for the repair needs for low-income 12 assistance people throughout the State in dealing with the 13 Smog Check Program. 14 It may appear selfish, but the concern of local 15 districts is, look, the genesis of the DMV money was a local 16 district effort, it is a local district decision to do it and 17 it is put in place to implement local strategies. 18 The California SIP is not an either or basis. It 19 requires the statewide strategies to be implemented, it 20 requires the local strategies to be implemented. 21 If it is State strategy that needs to be put in 22 place like INM and there is a problem low-income assistance, 23 find a source to do that that is statewide, don't pick on 24 local revenues that are already targeted to implement those 25 strategies contained in plans that are the responsibility of PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 93 1 local districts. 2 So, we were very protectionist of that. I sense 3 here on the part of Chairman Dunlap the need to continue that 4 protectionism, but looking for the assurance based on 5 guidelines and so on that gives us the strength we need to 6 withstand challenges. 7 I testified last week, as did Chairman Dunlap, at 8 Senator Kopp's interhearing on AB 1368, which is a bill that 9 would incentivize putting up diesel engines throughout 10 California and one of the funding sources there is DMV 11 surcharge revenues. 12 If districts participate actively in this program 13 it gives us the opportunity to put up a dollar and receive 14 five dollars from the JPA activity that would be collecting 15 the revenue and providing it to districts for projects. 16 Sounds good. I think there are a few districts 17 that are still at the one dollar level. In those cases, if a 18 district wanted to participate, it would require half of the 19 revenues that they personally collect to participate in that 20 program. 21 I think that is something that we need to be 22 cognizant of. One more point on the INM program in terms of 23 low-income assistance. 24 Right now the target is a smog impact fee, which 25 is, as you know, there is a court challenge on right now and PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 94 1 we don't know if we are out of the woods with regard to the 2 use of that fund or not. 3 What would be the alternatives, shall we go back 4 to, is the DMV pot vulnerable once again? 5 So, I think that we are going to have to be very 6 cautious as we move into the future here and look at how the 7 programs that are needed to cleanup California's air on a 8 statewide basis are going to be funded effectively. 9 One last point, I know it is in our Legislation and 10 I just asked Mark if it is 2766 Legislation as well, and that 11 is a five percent administrative cap that is placed on the 12 districts regarding the use of this money. 13 We can't expend more than five percent of it on 14 administration. So, when we talk about gathering data to 15 provide to the State so that additional reports can be 16 developed on an annual basis, that's digging into the five 17 percent cap that most of us are under currently. 18 I think we are providing the data on an annual 19 basis now. You folks now are going to have to gear up and do 20 the report twice as often as you had anticipated doing. 21 That is a concern, because that is an added cost to 22 the State, and where will the funding come to do that? 23 I hate to see an approach here in the future that 24 says that we need some of your DMV money to develop the 25 reports to show that we are doing the job right. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 95 1 So, we need to maintain a balance there. Those are 2 the points that I wanted to make. 3 Thank you for attention. 4 CHAIRMAN DUNLAP: Good point. I appreciate that 5 overview and you also helped answer, I think, in part the 6 question we are going to have Kathleen answer in a bit about 7 some of the Legislative intent, historical use. 8 Any questions of Mr. Covell? 9 Very good. Thank you, Norm. 10 All right. Barbara Lee, from North Sonoma. 11 Barbara, you are what stands between us and lunch, 12 I want you to know. 13 MS. LEE: Okay. I am Barbara Lee. 14 I am the Air Pollution Control Officer for the 15 Northern Sonoma County Air Pollution Control District. 16 I also sit on the Board of California Air Pollution 17 Control Officers Association as a representative of small 18 districts in California. 19 Since most of them are not able to be here today, I 20 felt it was important that I say a couple of words on their 21 behalf. 22 First and foremost, I think it is very important 23 that this Board recognize the importance of these programs in 24 small rural areas and the lack of funding that they currently 25 have and the importance of the motor vehicle funds for PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 96 1 supporting those programs. 2 I personally in my district do follow the 3 guidelines established by the Air Resources Board in 4 allocation of the funds, and I do provide more than 50 5 percent of the funds that I collect locally for grant 6 programs and less than 50 percent of the funds that I collect 7 locally goes to the support of my program. 8 I am a very fortunate district in that I am very 9 small, and I cover a small territory, and I have a reasonable 10 industrial base in the geothermal geysers, which supports 11 almost entirely my program. 12 Other air districts are not so fortunate. Some of 13 these rural counties are very large and cover a large 14 geographic area, and they don't have a large industrial base 15 from which to collect fees. 16 It has been an ongoing movement in California to be 17 aware of businesses and the impacts that we place on them and 18 to try and refrain from increasing the fees that we charge 19 them for the services that we provide. 20 At the same time, over this period of the last ten 21 years, the programs that I am responsible for implementing 22 have gone from 11 in number to 27 in number. 23 My staffing has remained constant. Aside from 24 myself I have a staff of four permanent technical people, and 25 that includes my field inspection crew, the people who answer PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 97 1 incoming public information questions, the people who do 2 permits. 3 It is a very limited operation, and we have to 4 survive on a very small budget. My total budget is under 5 $1 million a year. 6 Which brings me to my next point, the funds that 7 rural districts collect are very small in magnitude relative 8 to the numbers that we are talking about when you look at the 9 larger, more metropolitan areas. 10 I collected a total of just over $200,000 a year in 11 motor vehicles revenues. That is very different from the 12 many millions that are collected at larger districts. 13 It is important to bear this in mind, because the 14 funds that I am able to allocate for projects are very 15 different from the funds that larger districts have at their 16 disposal. 17 So, some of the projects that might be considered 18 desirable in larger metropolitan areas are not within the 19 scope of my ability to fund. 20 The largest project that I have ever funded was a 21 three-year effort to support the establishment of an 22 intermodal transit site on a railline that runs through three 23 counties. 24 We are hoping to promote the use of commuter rail 25 from Mendocino down through Sonoma and into Marin to PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 98 1 alleviate congestion problems for commuters trying to get to 2 the San Francisco Bay Area. 3 For that I have committed $300,000 over a three 4 year period. That is by far and away the largest project 5 that I have supported. 6 Most of the projects are under $50,000, or even 7 under $10,000 in their scope. So, you are looking at a very 8 different kind of allocation of the funds. 9 I am also limited, because I am a small district, 10 by the number of proposals that I receive. In only one year 11 that we have implemented this program have we received more 12 proposals than we had funds to actually grant. 13 That is very different from the situation that the 14 larger districts find themselves placed in. It is important 15 to consider this, because at the outset of the program when 16 this first report was done, a number of local districts were 17 criticized for failing to allocate the funds in a timely 18 way. 19 We are trying to balance the allocation of the 20 funds in a timely way with the need to hold on to the funds 21 for a little while to have enough to allocate in a meaningful 22 way. 23 So, as you are establishing your criteria, it is 24 very important to consider that the local districts face 25 different situations, and the smaller districts may not be PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 99 1 able to implement funds in ways that intuitively seem obvious 2 to those of you who are used to looking at larger and more 3 metropolitan situations. 4 Finally, I would just like to emphasize for you 5 that this is money that is locally collected, and it is best 6 used in a local way. 7 Most of the smaller rural areas are aware of the 8 fact that if money were, for example, taken from this fund to 9 underwrite vehicle scrappage, that money would be in 10 metropolitan areas and not in the smaller rural areas, and we 11 have great need of these funds. 12 Finally, a lot of us use the funds for public 13 education. If you live in a large metropolitan area the 14 importance of ride sharing and transit and reducing your 15 motor vehicle trips is something that you hear every day, but 16 that's not the case in rural areas. 17 The public outreach that we do has a very big 18 impact, and it really can work to change the habits of the 19 people in the areas where we are responsible for the air 20 quality and yet there is no way to effectively show the cost 21 effectiveness of the dollars we spent on those activities. 22 Thank you very much for the time. 23 CHAIRMAN DUNLAP: Thank you for that perspective. 24 I think that it was important us for us to hear that. 25 Any questions of the witness? PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 100 1 Very good. All right. 2 That is it, Ms. Hutchens? 3 All right. If there is no one else to testify, 4 there seems not to be, we will close that off. 5 Ms. Walsh, do you want to say a word or two about 6 the Parnell, the thorny Parnell legal question? 7 MS. WALSH: Well, I hope I have the got the right 8 legal question. 9 If I haven't, you'll have to correct me. 10 As I understood the concern was whether Mr. Boese's 11 rendition of the Legislative history here in terms of how the 12 money could be spent once collected was correct, and staff 13 does agree with the history as laid out by Mr. Boese. 14 The 2766 funds were intended to be a mechanism for 15 the districts to implement the requirements of the California 16 Clean Air Act, which was passed in 1988. 17 Specifically, the Legislative Findings and 18 Declaration directs that the money be used by the districts 19 to reduce air pollution from motor vehicles. That was the 20 recognition by the Legislature, that a significant portion of 21 the burden, obligation faced by the district comes from 22 emissions from motor vehicles and the use of motor vehicles 23 in those areas, and the Legislation goes on to say, and for 24 related planning, monitoring, enforcement and technical 25 studies necessary to carry out the Act. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 101 1 CHAIRMAN DUNLAP: Okay. Ms. Edgerton. 2 BOARD MEMBER EDGERTON: However, just taking it a 3 little bit further, perhaps you can refresh my memory and 4 that of the Board. 5 As I understood it when we reviewed these issues 6 before, a couple of years ago, I think Mr. Kenny pointed out 7 to us at that time that things had changed since 1987. 8 In 1987 we had a tremendous need to develop SIPs 9 and implementation strategies. Over time the planning 10 component has been reduced and the implementation need has 11 been increased. 12 So, while the statement of what the original 13 purpose of the provision was is historically accurate, 14 history has moved on. 15 What we need now is a bit different. Do you want 16 to comment on that or does it speak for itself? 17 I think we did realize that what we are looking at 18 now is use the money that is now being used to implement 19 those plans that were developed largely, of course there is 20 some planning still required. 21 CHAIRMAN DUNLAP: Mike. 22 MR. KENNY: I don't recall specifically what I said 23 two years ago, but in terms of the general thrust of your 24 comments, I do think that planning is still important, but 25 there are still clear needs to get emission reductions. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 102 1 So, what we are trying to do is figure out a way to 2 achieve the emission reductions in a cost effective fashion. 3 CHAIRMAN DUNLAP: If I may, what I would like to do 4 is come back, I think Joe Calhoun hit on it, and my colleague 5 Supervisor Patrick has an item that I think will be of 6 interest to those here, too, but I would like to kind of 7 summarize what we want our staff to do to get us information 8 and also to be responsive to the witnesses relative to the 9 need to have balance and clear guidance, but to provide some 10 autonomy and some awareness about what you all have to deal 11 with. 12 So, what I would like to do is entertain in a 13 moment a motion to move the staff recommendation relative to 14 task force and other things, but I would like to add a few 15 things to that. 16 Supervisor Patrick. 17 BOARD MEMBER PATRICK: Yes, Mr. Chairman. I am 18 wondering if there would be a way to have some kind of a 19 conference of cities to bring folks together so that we can 20 help better educate them. 21 I am concerned that there are a lot of people there 22 who want to do the right thing, but for some reason it is not 23 happening, and I think that we need to approach this in a 24 very positive and informative way, and I am wondering if that 25 would be something that would be appropriate. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 103 1 CHAIRMAN DUNLAP: Okay. I like that idea about 2 having some forum. 3 We could do it in concert with CAPCOA and some of 4 the districts. It may involve more than one, where we would 5 invite cities and we would talk about success stories and 6 about responsibilities of individual districts in the State 7 and the like, so I like that idea. 8 Anybody here that has a problem with doing that on 9 the Board? 10 Okay. Ms. Rakow. 11 BOARD MEMBER RAKOW: I hope that if we do recommend 12 a working group or a task force be formed that we take these 13 comments into heart that the rural areas are a large 14 geographic entity in California, and they do have very 15 different problems as she eloquently discussed. 16 CHAIRMAN DUNLAP: All right. So, we have a 17 conference, or several, dealing and focusing primarily on 18 local cities and counties rather than air districts, but it 19 certainly needs to be done in concert with the air 20 districts. 21 Joe had indicated an annual report, and, Mike, you 22 agreed to that. 23 Mr. Parnell, did I miss anyone over here that 24 wanted to add on to that? 25 Okay. PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 104 1 I am forgetting one thing, any written 2 correspondence on this? 3 We will come back to this in the form of a motion. 4 The Chair would entertain a motion in just a moment, but any 5 written comments we need to summarize? 6 No. Okay. 7 So, the staff recommendation, Mr. Kenny, do you 8 want to restate it for the Board? 9 MR. KENNY: Staff recommendation would be that we 10 form a working group and that we use the working group to try 11 to develop guidelines that will be applicable statewide. 12 In the context of that working group what we also 13 need to do is take into account the rural communities that 14 were presented by Ms. Barbara Lee, and we also need to take 15 into account Supervisor Patrick's suggestion that the cities 16 and counties be involved in a fairly high profile way so that 17 they can basically receive the guidance that they need, 18 because that is where some of the problems are right now. 19 CHAIRMAN DUNLAP: With preference towards a forum 20 conference event. 21 MR. KENNY: Yes. 22 Then we would also do an annual report to the Board 23 and report back to them with the idea also being that part of 24 that annual report would be the 10 best and the 10 worst, so 25 we can specifically highlight some of the good things and bad PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 105 1 things. 2 CHAIRMAN DUNLAP: Okay. Mrs. Riordan indicated the 3 idea of having some kind of incentive element explored and 4 that would probably need, I see Chris Reynolds back there, 5 probably need to be put in a context of a Legislative 6 opportunity for to us provide some resources or some emphasis 7 for that. 8 MR. KENNY: We can look at that, also. 9 CHAIRMAN DUNLAP: Okay. 10 BOARD MEMBER RIORDAN: I so move that second staff 11 recommendation with all the addendums. 12 CHAIRMAN DUNLAP: Okay. Mrs. Riordan made the 13 motion, seconded by Supervisor Patrick. 14 Any discussion? 15 All right. Very good. 16 We will proceed with a voice vote. 17 All those in favor of the staff recommendation with 18 those amendments, say aye. 19 Any opposed? 20 All right. Very good. 21 Thank you. I would like to thank the staff, again 22 emphasizing having some empathy for Ms. Terry and her team. 23 Again, you were not hired to be auditors, we know 24 that. We appreciate your insight and your willingness to 25 work successfully with the locals and how that is coming PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 106 1 along, you need to do more of that. 2 Mike, I will entertain some discussion about 3 resource enhancement, but proceed gingerly on that point, 4 perhaps in a month or so we can talk about that. 5 All right. We have two remaining items. 6 I am going to take a chance before we break for 7 Closed Session and lunch. We have an Open Comment Period, 8 and I would like to ask if anyone that wants to comment, we 9 provide an Open Session. 10 We provide an opportunity for members of the public 11 to address the Board on subject matters within the 12 jurisdiction of the Board. 13 Although no formal action by the Board may be taken 14 on this item, the Board is allowing an opportunity for 15 interested members of the public to address the Board on 16 items of interest that are within the Board's jurisdiction 17 but do not specifically appear on the Agenda. 18 Each person will be allowed a few moments, five 19 minutes to present their issue. 20 Is there anyone here that wishes to take advantage 21 of that? 22 All right. Very good. 23 We will then proceed to the last Item on the Agenda 24 today, which is a Closed Session to permit Board Members to 25 confer with or receive advice from its legal counsel PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 107 1 regarding pending litigation. 2 The subject matter of the Closed Session is a 3 lawsuit filed on September 18, of this year, in Federal 4 court, against the Air Resources Board and other parties. 5 The lawsuit is Coalition for Clean Air, Inc., et al 6 versus the South Coast Air Quality Management District, et 7 al. 8 With that, we will go into Closed Session, and then 9 I will come back and close the meeting. 10 So, thank you. I would anticipate this would take 11 about an hour. 12 Kathleen, does that seem to be sufficient time? 13 We will take our lunch with the briefing. 14 Okay? 15 We will be back around one o'clock. 16 Okay. Thank you. 17 (Thereupon the lunch recess was taken.) 18 19 20 21 22 23 24 25 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 108 1 A F T E R N O O N S E S S I O N 2 --o0o-- 3 CHAIRMAN DUNLAP: The meeting of the California Air 4 Resources Board is now in session. Please come to order. 5 Very good. Earlier today the Board met in Closed 6 Session to confer with or receive advice from legal counsel. 7 As there was nothing to announce from the Closed 8 Session, we adjourn this meeting of the California Air 9 Resources Board. 10 (Thereupon the Air Resources Board meeting 11 was adjourned at 1:15 p.m.) 12 --o0o-- 13 14 15 16 17 18 19 20 21 22 23 24 25 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345 109 1 CERTIFICATE OF SHORTHAND REPORTER 2 3 4 I, VICKI L. MEDEIROS, a Certified Shorthand 5 Reporter of the State of California, do hereby certify: 6 That I am a disinterested person herein; that the 7 foregoing hearing was reported in shorthand by me, Vicki L. 8 Medeiros, a Certified Shorthand Reporter of the State of 9 California, and thereafter transcribed into typewriting. 10 I further certify that I am not of counsel or 11 attorney for any of the parties to said hearing nor in any 12 way interested in the outcome of said hearing. 13 IN WITNESS WHEREOF, I have hereunto set my hand 14 this second day of November, 1997. 15 16 17 18 VICKI L. MEDEIROS 19 Certified Shorthand Reporter 20 License No. 7871 21 22 23 24 25 PETERS SHORTHAND REPORTING CORPORATION (916) 362-2345